After 4 years I have revisited this for a different section of my game! I also reviewed Romans Romans-I-XVI game engine code for this idea.
In the end it worked best for me to rotate first, scale second, with maybe a bit more complexity (although I didn't need a second region, just the second bitmap), mainly due to the fact that it eats up less texture memory. When scaling first, I had to make the second bitmap (for rotation) the full dimensions needed (in my case up to 2x). But when rotating first, you only have to make the second bitmap (for scaling) slightly bigger to accommodate the rotated image's corners, but then it can be scaled up a lot without using up extra texture memory. Whether this is the best approach for anyone in general depends on whether they're already using a lot of texture memory, whether they'll be enlarging the image significantly, and maybe some other factors.
And again, I greatly appreciate the code examples from NewManLiving, squirreltown, and Romans-I-XVI 🙂 Grasping how bitmaps and regions really work is STILL difficult for me.