I made a replica of the Ranger Tab out of hardwood and plywood for my Dad, who was a US Army Ranger. I wrote up a more detailed description of how this was made on my blog.
The first step was creating the letters, which I did by milling them out of wood on my Othermill Pro. Even with a 1/16" endmill, it went pretty quickly. I used Nitto tape for fixturing since the cutting loads are fairly low and removing stock is still easy.
My Othermill isn't large enough for the outline and back pieces, so I had those lasercut out of birch plywood. Next, it was onto priming and painting.
The letters are held on with two small screws each and the outline is glued to the back. I'm happy with how this came out!