[Kampar]

Here's a PSD file containing an extracted Magnifying Glass, a glass effect layer and a template for the interior of the glass. I used this on the back of my Moonlighting covers and figured it might come in handy for someone else.

Basically, you load the image you want to 'magnify' into the background layer. Then make a selection based on the area in the 'template' layer. Then, use the Photoshop filter "Distort / Spherize" with a setting somewhere around 50 - 60% to create the 'fisheye' effect. The Glass layer gives it a slightly more realistic effect, but you can experiment with different glass treatments of course.

Note: do not extract the circular selection from your image before applying the filter: apply the filter to the selection you have made on the Image layer, not on a separate layer of the cut out area only. Hope this makes sense - any problems add a post here or PM me.