Need help ASAP! How to do this in Illustrator instead of Photoshop (Burnt wood text)

[mwenz]

Well, I would use a bitmap editor. But I think you can get close.

I have attached an AI CS6 file in a ZIP that is about 2.5 megs--it has a reduced size of bitmap from the article you linked to. You don't mention what version you are using. There are only 3 items in the layers panel with one the bitmap. Click on one, then open the Appearance panel to see the applied effects and settings for that particular object.

Take care, Mike