Brace yourself, this is going to be a rather long one folks! This is how I reposition:

Step 1: First thing you need to do is to create a lineart. Once you have done that, you fill the line art with a base color in a layer underneath the line art, doesn't matter which color, this is just to have something to go after when repositioning. Remember that the lines have to be perfect in this base, so I recommend using the selection tool and fill the selection with the color, rather than just draw the base.

Step 2: Choose your in game images. Make sure to take the pictures as close as possible, and in the some what correct position according to your reference. I always take a very close up picture of the horses face and ears, and often do a separate photo of the chest area, but you of course choose yourself how many/few pictures you want to use.

Step 3: I always start with the belly/bum area, both in one piece. Reposition the picture so it covers the line art some what decent. For this I use both the transformation tool and the warp tool

Step 4: This is where your base layer comes in handy! Select the base layer, invert the selection and simply erase the parts that's outside the line art/base.

Step 5: Use your selection tool, or eraser depending on what you'd like to use, and erase the parts that's not in place. In this case it was the shoulder/chest and flank area. Complete this step by locking the layer and use the smudge tool to smudge the edges in case you haven't managed to cover the edges with the sso picture, as you can see in the step 4 image.

Step 6: My next part is to reposition is the legs. I use the same method here. Cut out one leg, reposition it over the base layer, select the base and erase the parts outside the base layer. When doing the legs that's closest to the "camera" I always merge the layer with the belly together with the two legs. The legs behind, I keep on a separate layer

Step 7: Since you now have the two legs and the belly/bum on the same layer, you can smudge over the transitions so they connect smoothly. The legs in the back should remain on separate layers.

Step 8: Same method used on the neck and chest. In this particular repositioning I decided to reposition the neck and chest separately or else the chest area and muscles would have gotten too big. Merge all layers together (except the left front and hind leg, and again, smudge the transitions together

Step 9: We're almost done, and the face is for me one of the last things I reposition. I always cut out the eye, and then the same method as always. Reposition over the base layer, select the base layer and erase the parts around. Is the nostrils too big? No worries, we'll get to that later! And don't worry if the mouth/lips is misplaced, we'll fix that too!

Step 10: Reposition the eye and merge the face and eye layer. Draw over the gaps and color pick/smudge together

Step 11: Repositioning the ears. Same method as always. In the end you should only have 2(3) layers with the horse. One layer for the body and the legs facing the camera, and one (or two) layers for the legs in the back.
But now, the nostrils and mouth look a bit odd? Unless you want to draw this part yourself, which I often do since these parts looks a bit unrealistic in the sso style, here's a neat little trick;

Step 12: Use the clone tool to clone the nostril, draw the cloned nostril on a new layer and simply adjust the size and shape. Use a brush and draw/erase the rest of the original nostril underneath. Merge the layers together and go over the transitions. This step can be repeated with the lips/mouth

And that completes the whole repositioning prosess, in my way of doing it anyways. In my case the next step is to shade and highlight, since the muscles etc are kind of misplaced after the repositioning, but if you are more thoroughly than I am with repositioning, then your edit might not need more alterations!
Hope this helped! ❤️