Definately go with the glue! It is much easier to work with after it is set. I used to make these really cool monsters out of the mix over top of balloons and coat hangers using sculpey for the teeth and eyes. It was fun and very manageable.
There is a really cool stuff called Modge Podge as well that works. I have a partially made stubby jet pack from a TDH member that I've been working on and he did the most fantastic job of smooth papermaching I've every seen. So now I'm building on that base with many, many layers of Modge Podge and it's hard as a rock. Modge Podge actually looks like white glue and dries clear. It's sandable and paintable. A really versitile product! It also comes in a version with sparkles for anyone who wants to be Flashy Fett....
so then what ? do you just dip the news paper in the stuff and get to shaping ? and how would you do a face ? can you do your own or wouldn't it burn you ?
I would use like a manaquin head or something. It is hard to get paper mache to look great if your doing something as detailed as Han in Carbonite. I would sculpt the thing in Clay and go over it or something to that effect.