I found some great software online called Halftoner by Jason Dorie that allows you to make a halftone pattern out of any picture. I think pictures with a good amount of contrast work best however. The software outputs G-code directly and only one statement needs to be removed for it to work in EMC2.
Halftoner creates a pattern of holes which vary in size. You start off by spraying a panel of wood black. The smaller the hole is the darker that spot will be. By slightly varying the depth of the holes you get darker or lighter spots.
A video of my CNC machine in progress:
A timelapse of the CNC router to speed things up: