Get a Huge guitar:

Trance Acoustic Lens 

This is not cheap. But it is the best way I've found to reproduce acoustic guitar (steel string). Combined with an AKG C12 microphone it offers the best of all worlds. Then you can add convolution verb as you choose. I pan my stereo output from the Amulet preamp at 3 o'clock and 9 o'clock. Bass strings left - Trebles right. It's used by many artists for years, including Arrowsmith, Neil Young, David Crosby, Jackson Browne, and Traci Chapmann.

Doug Young, sterling guitarist and ace recordist (but not yet a Reaper devotee) has a bunch of pickup samples up at including some Trance samples. Fran

A lot of that sound is the fact that the guitar is compressed to hell. Record in stereo, compress to death, add gross amounts of delay and verb.... get something pretty for yourself... rinse and repeat.

I reckon Bubba's on the money there. If the Youtube clip is anything to go by I would add record a magnetic pickup as well as a mic on separate tracks and blend them, use different delays and reverbs on each and pan

My favorite trick to make any acoustic instrument sound big is record it mid/side. My favorite mic for this is a Royer SF12.

Use an Omni! 

In my experience one of the least used, but MOST effective ways to get a great acoustic guitar sound is to use a small diaphragm condenser mic with an OMNI directional capsule---NOT a cardioid. Point it at the neck/body joint about a foot away, and you're all set. This nearly eliminates the boomy proximity effect you get with large diameter cardioid condensers, and more closely resembles what your ears are hearing from the guitar. (Also experiment with it over your left shoulder pointing down, or your right shoulder more towards the hole---experiment!) The down side is that an omni will pick up everything around it, so you want to do this in a well damped environment. If you don't have an isolation booth in your home studio, then your bedroom closet with all it's fuzzy clothes hanging in there works great! Try an omni on your acoustic...you'll never go back! BTW, an inexpensive omni that is wonderfully suited for this is the Oktava MK-12 (MC-12?). It has the option of using different screw-in capsules (hyper cardioid, cardioid, omni directional, -10db attenuator) and they are readily available on EBay. Guitar Center used to give these things away for $49 bucks! I see they are selling for considerably more now . (capsules are about $75-$100 or so I think) I guess the secret got out---good bang for your buck...

At the risk of getting flamed, I have heard & used these 2 Behringer Mics.... Behringer ECM8000 Microphone Behringer B-5 Condenser Microphone The 2nd one has 2 capsules included. They both have surprised me on Acoustic (steel & nylon), Mandolin, Bouzouki, Mandola, and smaller hand drums. The price was NOT equal to their performance, they performed way above the cost. As usual, this is IMHO, YMMV, etc etc.