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This is pretty much how i make my PCBs too. the biggest difference is that i plan it out on Eagle, print it out in mirror, tape it to the copper side of the board, drill the holes, remove the paper, then use a paint marker to draw the traces. Drilling the holes out first based on the printout from eagle helps make it accurate for DIP ICs. Also, I use 1 part muriatic acid (acid magic) and 2 parts hydrogen peroxide. I have not seen the water/acid/peroxide formula before, but i will try it the next time!
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