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Update - 3-27-08: I've had a lot of people asking me if it's OK for them to do *insert particular thing here* with my art. So, I'm going to try to create an all-inclusive list here of what's OK, but don't hold me to it :) More things than this are probably fine, I just don't know about them yet!
Creating: Sig Tags, with or without names or slogans - Stationery for Emails - Websets, as long are they aren't for sale in any way, or used on a commercial site-
Tutorials, again, not-for-sale - Avatars (Those little icons in chat rooms)- Tubes - Animations (I ask that my character's faces aren't covered during the cycle)
Framing (Adding a digital frame to an image) - Game mods (Like Sims, where you can add art to your houses, etc)
Tags, etc. may be made as prizes for groups that have online competitions (I've seen things like "Best lion tag of the month, or such), but
please let me know that's what it's being used for in advance!

You May Not: Sell ANYTHING you've created with my art. That's my job, and I hate being hungry.
Print anything you've made with my art (or my art in any way at all - even unaltered)

Add or imply any kind of derogatory, racist, hate, sexist, vulgar or otherwise inappropriate message to my work
(I reserve the right to decide what is inappropriate, much like the FCC.
But if it's funny enough, I may allow a certain amount of "Vulgarity" as they would phrase it, so if you must, you have to send it to me for approval first.)

If you use more than one artists' work in a creation, they must ALL be creditied. If you use a photo, the photographer MUST be credited.
If you took the picture, then give yourself a credit for it visibly! If you think it's 'Public Domain', it probably ISN'T!
I don't want to see any more tags, etc. with obviously uncredited additional elements. That's the kind of thing that
the U.S. Congress is using to justify their "Orphan Act" in the first place. Let's not help them ruin our fun
!

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OK - I've finally come to the desicion that suspending my permissions was not helping anyone, and really just bumming out a lot of people. So the heck with the whole Orphan Act thing, and all the licensing companies. The only one I found that I liked the contract from seems to cater mostly to people who want to make tags of sexy women (You don't see anything but that on their home page) , and I have always had the feeling that a lot of folks want to tag my dragons too. So, we're re-instating all suspended tagging permissions, as of now. 3-10-2008.

The general permission statement is this:
Most importantly, I require that anything you create by "altering" my work in
any way is sent to me before showing it anywhere else, mainly so I can be
sure that the themes of the artwork haven't been changed from my original
intents.  Practically all alterations get approved, though :)

Also, I don't allow people to put a separate copyright notice of their own
on my work.  I've noticed that people are starting to do that, and it makes
for artist's problems legally.  Only my name (Rob Carlos) may be used with a
copyright mark - © on my artwork.  Putting a "tagged by" or other identifier
is fine, as well as the actual name on the tag, of course.

Of course, a link back to www.colorsmith.com on your website would be
appreciated as well!  There's a little piece of html you can grab off my
"links" page for that, to always get the current banner.

If this all sounds good, then go for it!  I look forward to seeing what you
create.

Now - I reserve the right to change that statement at any time to clarify the intent of the wording, etc. But as far as I can see, taggers should feel free to create to their hearts' content. I would hate to be the one standing in the way of creativity. Meanwhile, this permission should not in any way be considered as my placing my artwork into the "Public Domain". Anything created with my work MUST be submitted to me for approval, and I must be notified as to what the creation will be used for in advance. I reserve the right to deny any usage of my artwork at any time, and will uphold that right - particularly in cases of profitting upon my work.
Rob