Here's a simple approach. I use WinImages but you should be able to do it in photoshop or
PSP:
Isolate the image (the face). I cut it out and put it on it's own layer (which is probably where you have it anyway, eh?)
I put a base underneath the hole where the face was that is the color of the bill background.
I converted the face layer to monochrome and increased the contrast 100%
I ran WinImage's "Derivative" operator on it, signed on gray and multiply level 2. This is a pretty vanilla math function, you should be able to find a plugin that does it freeware or maybe photoshop already has it. This gets you the lines where the engraving cut would be.
I set the face layer to multiply. Now the lines modify the base color underneath. Looks decent, though you either need a sharper scan of the bill, or softening of the face.