Here is a brief explanation on how it is done. I separated it as 3 different jpeg exports. Shading, shadow, and sketchy edges. All you have to do is save a scene so your camera stays locked. Then start exporting jpegs with different styles. Shading = Shaded style edges off (White material). Shadows = Hidden line edges on (white edges). Edges = Any Sketchy edge style you prefer. In photoshop run some filters on the shading and shadow passes. I used alien skin snap art which isn't free but you can use a combination of native photoshop filters with similar results. Then set those 2 layers to multiply and adjust the opacity to your liking.
I attached an example of the process. Pardon the crappy model I used as an example.
http://img14.imageshack.us/img14/2653/sketchyshadowresponse.jpg
If you have any questions please feel free to pm me.