Let me refer you to an artist on Flickr that does this very thing beautifully. The way you grout just your butterfly is just that - you grout it, then take your damp gloved finger or damp brush, and smooth the edges around it, washing the grout off your rock - real easy. Giving you a link to the artist on Flickr.
The Rock Lady

Those of the less coordinated and more messy (like me) wound use some masking tape or painters tape around the mosaic for accidents. I am the worlds messiest grouter.

Wow!...that is a cool idea. I am now thinking about all the rocks that I have in my garden that I could do this technique on!

Has anyone used the ball chain? How would you glue that onto your substrate especially if it is outside...like a rock?

Wow, what a creative person! Have any of you used rigid wrap before? I'd never heard of it.

Yes, I have used rigid wrap. my fave method is to just apply fiberglass mesh wall repair tape-its sticky-and then skim coat with thinset. that and some styrofoam to carve and you got yerself a substrate.
I guess I would use silicone to glue down ballchain outside-lay down a thin bead and set the ballchain into it.