A keen eye from NeoGAF has caught a comment from Official Playstation.Blog writer Chuck Lacson regarding how you will get custom pictures into Little Big Planet. Replying to the question of "Will I be able to import my cat pics into my created levels?" Chuck wrote back:
"yes you will! (If you have a PS Eye that is.)"
From another PS3.blog post:
"I though LBP will allow us to totally customize sackboy so wouldn't that mean we could simply make a Kratos of our own?"
to which it was replied with
"You won't be able to customize your SackBoy in the detail that you describe, but there may be a few ways you can work it. For example, you can wear a cardboard box costume item or cardboard mask costume item and sticker it with a Kratos image using your PLAYSTATION Eye. You can even sticker/slap decorations your SackBoy directly…so the possibilities are endless." -Mark Valledor