Thanks for the feedback all of you. Your thoughts and ideas are encouraging. What a great community on this forum.
Of course I expect some who think it's not a good idea. I expected more of those actually. Not that it would deter me from my venture. And I do know the value of the car will go down. I'don't think to sell her any time soon anyway.
Yes, I've thought about vynil, or trying something not permanent. It's just not obvious where I might find vynil, but perhaps I'll just spray a few sheets of paper and tape them down on the car to see how it would do.
I'll continue with either drawing or actually some "Photoshop" for now. (I actually use the GIMP, a free community developped equivalent, and quite sophisticated image manipulation tool. There is a Windows XP version GIMP. I find it's actually easier to use than Photoshop and less system resource-hungry).
I'm thinking about covering the hood, the top and trunk, and also the sides. I may actually go with a different color too, something more subtle like a really dark red. And I'm not decided on the scale of the squares, but I probably won't cover an entire surface; more likely I'll do something like the drawings I've posted so far: stripes of squares, wavy or straight.
It's quite an artistic process as you can see, and I'm not done with my research.