Is that a practical option right now when support of legacy browsers is still a necessity?

I think it is highly practical, since one very skilled designer and CSS programmer with enough programming skill (or a team) can create a template that many other less skilled and less experienced designers can then take and use at will. The template, while being rather complex compared to the hand-coded and "beautiful" markup that Thomas was talking about, can also have enough dumb logic in itself to degrade gracefully on legacy browsers.

Wouldn't the degraded version depend upon the same old Photoshop approach? If so, you might as well keep using that approach until all major browsers support the necessary components of CSS3.

I was thinking more along the lines of:

    <a href="#"><div class="mybutton">Button</div></a>

    .mybutton {
        padding: 10px 5px;
        border: 1px solid black;
        background: red;
        width: 100px;
        text-align: center;
    }

Instead of a gradient background and rounded corners, which is still trivial to write by hand.

You still have to "manually" create it in the first place. After that you can automate it regardless of how you choose to render it.