Hey, one thing I've found out is that instead of contracting the selection, you can repaint the edges. For me, it's faster, since I usually have my Wacom tablet on my lap already.
The best way to do this is to create a new layer just above the one with the render already cut out. Then, right click on the layer; select clipping mask. After that, you could scribble all over, and nothing will appear outside of where the render's edges are. I wouldn't recommend that though... Anyways, use the eyedropper tool to get the proper color, then just go along the edges, making sure to change the color at certain points so it matches. You should, preferably, use the airbrush tool. Mess with the opacity settings until the edges blend with the image just right.
I used this technique on my iron man render. I didn't want to lose some important details, or shrink the image overly much, so it seemed like the best option. Also, not all the edges needed to be modified. And I already had it out.
Oh, and when doing modifications that don't fit in the original canvas size, make sure the expand it. With the flashlight effect having the sharp edges, it immediately removes considerable usability with the render. Snowy, I know you were just showing the basic technique, so that's more to other folks
. And, for the watermark on the bottom, a black brush will easily remove it.