Making object shape conform to raster visual edges

[wizard509]

However Big Franks tutorial uses bitmaps right up to the trace step

I think that's what you will need to do also. After you use the method described above to remove the background make a final bitmap copy do to the trace. That way the trace will only see the bitmap without the background. If you don't the bitmap trace will still see the background. The results you get will depend largely on the bitmap trace settings used. Even then it may yield unsatisfactory results.
But you can get photographic results. Black Panther once posted his settings to yield fantastic results but I do not have them any longer, I wish I did. At any rate after you get something you are happy with make sure you select all the objects and, there will be many, so group them. If there's a way to "automate" the tracing step I don't know what it is.

[Tallis]

thank you both for doing a tag team intervention here, i think my brain may have gotten closer to what the concept is...

i wonder what those black panther settings were