Much of the advertisement for the movie "S1M0NE" included a pixelated version of an image as an overlay. (To see a sample, go to www.s1m0ne.com.) Here's one way to achieve this effect.
Open the image that you want to create this effect on. If the file has multiple layers, use the command Layer > Flatten Image. At the bottom of the History palette, click on the left-most button to duplicate the image. This creates a separate file, identical to the current state of your original image. (I use this button often when I want to experiment with filters.)

Working with the duplicate image, let's pixelate it. Open Image > Image Size. Look at the upper Width and Height fields. You'll want to reduce the image to exactly 1/10th its pixel size. You can also reduce to 1/8th, 1/12th, or any size in between. It is important, however, that the reduction be exact - no fractional pixels. Make sure that both constrain proportions and resample are checked. Set resample to Bicubic. For our example, we'll reduce the image by a factor of ten to produce nice large pixels

NOTE: If neither the width nor the height can be evenly divided by an appropriate number, return to your original image and crop off a pixel or three, then create a new copy.

Open the Image Size dialog box again. Change resample to nearest neighbor, and return your image to its original size. You're image should be nicely pixilated.
| (Optional) | You can use Levels, Curves, or other adjustments or filters to change the appearance of the image. To better achieve the look of www.s1m0ne.com. |
Position the two image windows so that you can see them both. Make sure the pixelated version of the image is active, then hold down the Shift key and drag the layer named "Background" from the Layers palette directly onto the window of your original image. That copies it from one image to the other. The Shift key ensures that the copied layer will be centered. You can now close (with or without saving) the pixelated version.

Make sure that Layer 1 is active in the layers palette. Make a selection of an area through which you want the lower layer (the unpixelated version) to show through. Use the menu command Layer > Add Layer Mask > Hide Selection. A layer mask will appear in the Layers palette, showing what parts of the layer are visible/hidden.
You can add a white border, if desired, in any of a number of ways, including a bevel/emboss Layer Style. I simply used the Pencil tool on the first column of pixels outside the mask. Remember when working with a painting tool, you can click, then Shift-click to paint a straight line between two points.

| (Optional) | The effect can be modified in a variety of ways. By duplicating the upper layer and changing the mask, you could create frames of an animation that open like a curtain. You can also try different blending modes for the upper layer, such as Overlay, Difference, Luminosity, Hard Light, and Vivid Light. |