Sometimes at this point I also add a Pattern Fill Layer. If you do that, you’ll have to adjust the opacity so your matte color will show through. I don’t do it much, because the patterns have a tendency to distort the color I chose for the matte.
7. Now, select the Move tool and drag and drop your image on to the new canvas. If you hold down the Shift key while moving, it will automatically center on the canvas.
If your oval selection is a little too big or too small, select the Move tool, hold down the Shift key to constrain the proportions, and resize it slightly.
You can also add another line around the oval selection by doing Command/click on the image layer, then Edit>Stroke. Using Layer Styles on the same layer, you can add a drop shadow to the stroke.
If the matte looks too "flat", Command/click on the Color Fill layer and experiment with stuff out of the Filter menu. Using Noise can give a slight texture, and you can set it to monocromatic or add a touch of color. It’s really fun to play.
I hope I've got everything down the way it's supposed to be. If not, let me know where you're running into trouble. Have fun - and sorry it took so long. :)