Create Automator Service With a Python Script?

I'm trying to create an Automator Service that will act on selected text, converting dashes to spaces, and also making word caps for all the text.

A friend gave me this python script (I know nothing about python or shell scripting):

#! /usr/bin/python

cliptext = "%clipboard"
print cliptext.replace('-', ' ').replace('%', ' ').replace('&', ' and ').replace('#', ' ').title()

It works great as a TextExpander snippet, but I'd like to have it available in the Services menu as well. I don't need it to use any specific scripting language, it just needs to run within Automator. My coding buddy had no experience with Automator so he couldn't help out. His script requires copying the text to the clipboard, and then runs the formatting and pastes the result. I'd like to be able to just run this on the selected text and not have to deal with the Clipboard (at least manually).

The particular use for this is to rename photo uploads on Flickr, since Flickr uses the filename to generate the photo name. When exporting artwork via Photoshop or Illustrator using Save For Web, the lowercase and dashes are my default settings. I want to be able to highlight the Flickr title, and then run the Service to reformat the file name to a properly formatted title.

This isn't too difficult to do, you just need to know the right magic. I'll walk you through it.

1. Open Automator, and when prompted to choose a type for your document, select Service. If you're not prompted, just hit ⌘N to make a new automator file.
2. At the top of the rightmost panel, make sure that Output replaces selected text is checked, and the first drop-down is set to text:
   • You can change the any application part to a specific application if you only want it to work in that program.
3. In the Actions Library in the left panel, find Run Shell Script and double click it to add it to the workflow.
4. Change the Shell drop down to /usr/bin/python, and make sure that Pass input is set to stdin.
5. Delete the existing text in the script box, and replace it with the code below.
6. Save it with a descriptive name. Automator will save it in the ~/Library/Services/ folder.
7. Optional: Go to Keyboard Preferences, and find your service in the Services section of the Keyboard Shortcuts tab. You can assign a system-wide shortcut for it there.

Script Code

import sys

for f in sys.stdin:
    print f.replace('-', ' ').replace('%', ' ').replace('&', ' and ').replace('#', ' ').title(),