This is my current Photoshop workspace for the Bono piece.
Layout is pretty standard - I generally work with the ref photo on the left - painting on the right.
Edit: The skin I'm using is called Tronnix.
Couple of handy tips:
~ Why are there two views of the same file? - By creating a second window for the painting (Window > Arrange > New Window for "filename") you no longer need to zoom in & out of your piece to view the overall progress.
As you paint on the original, the copy updates too. A very cool feature.
~ Match Zoom & Location - If you tend to work with a similar layout to me, using the Window > Arrange > Match Zoom & Location could be a lifesaver.
This feature does exactly what is says on the tin. With your work document active, choose the option from the menu and your reference image (provided the dimensions of the document are similar/the same) will zoom in to the same area as you are currently painting and at the same magnification. Genius.