I just saw the photo in text idea today while looking at the May edition of Digital Artist Magazine. Then I remembered the letter 'x' challenge currently going on at SBF and this was the result!
If you want to try to out, just place your photo on top of the text and then with the photo layer selected press CTRL+G or you can place your cursor between the two layers, press ALT and click. Whichever way you prefer, they both give you the same result... and you're done, unless you want to merge the layers and move them somewhere else. I also added paper to the letter the same way behind my photo then played around with blending. I ended up blended my photo twice, the uppermost layer is the screen blending option and the next layer down is the luminosity blending option. The luminosity option made the photo the color of the paper while the screen option lightened it. It always takes me a lot of experimentation until I find the right combination of blended layers to achieve a look I like. The same combination may not look the same with a different photo and/or different background. And that's all for now... I hope you learned something today! :)