How to Combine Ambient Occlusion & Texture in Blender 2.6

Okies, so at first I didn't even plan to do baking an AO in the Blender 12 Steps Chair Class, but since everyone is doing sooo much better than I thought we would, I have been revising as I go along.

First I added an Ambient Occlusion bake to the end of Part 7, even though my own personal demo chair never got one, and has to live with the shame of the world's craziest ever UV map lol.

I guess I might have known that after the AO Bake, people would want to know how to combine the shading texture (AO) with the woodgrain texture into a final diffuse map (aka "texture" in SL). I always do this in Photoshop and in general I think you can get more options and better results using a graphics program to finalize your textures. But this can also be done in Blender with not too many extra steps after the Ambient Occlusion bake.

So I made is a video showing how you can do this in Blender and save the final image as the texture (aka "diffuse map" everywhere outside of SL).
Here you go.