Raven is ridiculously easy to use.
You can also adjust all your paths prior to exporting, and a whole bunch of other things that I haven't figured out yet.
A trusty stand-by of Ludum Darers is Autotracker Bottom Up. There are also tools like iNudge and Roc.
The thing with these tools is that they make very short songs. iNudge makes songs that are ten or twenty seconds, same for Roc, and Autotracker makes songs around 50 seconds long. Don't loop them over and over if you want people to keep playing your game.
This one was really straightforward.
The go-to is GIMP which can pretty much replace Photoshop entirely if you put a little effort into it.
You could also try out Seashore which is a bit simpler both in features and in usability.
Also, consider web-based options. Aviary is pretty good. I was going to mention Picknik but apparently it's been shut down and the features rolled into Google+ which may not do you any good...
Thanks!
Here's my final attempt. It's far from perfect, but thought I'd post it on here anyway. Feel free to use it.
Also, here's just the power button, and here it is with a bevel.
I once recorded myself 6 times using different voices saying this over. One of these days I plan to remix it into something uber creepy sounding.
Pixlr is a really good online editor. It's not as powerful as GIMP or Photoshop, but it's browser based, has all the tools you'd expect and it's free. Really a cool tool to try out.
Aviary is another good browser based tool and they're expanding it to other platforms. It's more powerful then Pixlr, but I find that if I do anything big my browser can't handle it and crashes. So for big projects I crack open GIMP, for small ones I stick with Pixlr.
Play with Raven, it's a free online vector editor, and very user friendly. Load your png/jpg, and click Object>Bitmaps>Trace Bitmap to create your vectors.
You'll likely need to clear out small empty spaces, because the bitmap tracer detects minute differences in color (usually an issue with jpg, not so much with png). Then export as svg and load it into the cutting software.
That's the really fast overview, good luck and have fun, vinyl cutters are awesome.
Thanks. I'm using the Aviary tools Roc and Myna, so that sort of limits me on what I can use. I will see if I can switch around the instruments for some better quality versions.
I'm not sure, but this might let you import the EPS. I've used an earlier version of the software and it works ok for basics. It's all online and free so it doesn't hurt to try.