Sometimes I just surprised after viewing some work of CAD Conversion. They are really doing the jobs as a graphic artist.
One thing I can share with everyone that the Raster to Vector conversion is one of the tough job, if you want to do it properly.

Hey thanks for the post..

I agree with you that Raster to Vector Conversion is a very tough job when it is accomplished manually. It is very time consuming also. It would be great if we share our techniques which we use in order to overcome the difficulties of R2V conversion.

I am sharing my own techniques..

* First I scan the drawing/blue print, if it is possible. If the drawing/blue prrint is larger than the scanner, I scan them sequentially in separate images and stich them togather using the Photoshop Software. There are sveral software for image stiching, but from my opinion, Photoshop is the best..

* Second, if the scanned data is not too fuzzy, I use paper to cad software for creating the primary cad data. You can find many free software that can convert image data or pdf data into cad. I prefer scan2cad (http://www.softcover.com/).

* Finally, I correct or redraw or modify the drawing manually using AutoCAD.

* But, if the drawing is very old or fuzzy, it becomes more tough to interpret correctly using conversion software and I become forced to apply fully manual conversion process.

---Manual Conversion---
* After setting up units and other standards/settings, import the image using 'Insert -> Raster Image Reference../'.

* Draw any dimension (Linear/Aligned) on the image. Compare the aspect ratio between the actual dimension to that it is shown on the image.

* Resize the imported image simply clicking to any end point and dragging or by applying the Scale command. Keep doing it unless your drawn dimension matches exactly to that of the image.

* Create a new _layer_ and put the image to it. Lock the _layer_.

* Now, keep drawing to the end...

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This is what I try to follow in case of Raster to Vector Conversion (2D). Hope you might be know some thing more interesting, easy and accurate techniqes..

Yes, the technique you said, I also agree with that. I always prefered to draw the images into cad by manually. It will increase the drawing perfection.
As I said it is tough because it is very rare to any single one to understand all types of drawing.
Such as in a case piping isometric drawing, some guys drawn the flanges like an egg, actually they are using spline instead of isocircle or ellipse. You can understand the spline _object_ is rarely used in engg. drawing.

Another thing for the technique, it is always better if you use Raster Design or Cad Overlay for stiching. These are like plugins of AutoCAD, I hope you know those. By raster design you can stich all images correctly. If there is any problem in scanning then you can rubbershetted the image to match with another perfectly.