There's a number of different ways art becomes "digital," whether it's for a playing card design or for any other kind of application.
Sometimes an artist will create the entire work on paper or a similar medium using traditional tools, then scan the end result into a computer to make it digital.
Sometimes an artist will make the entire work digital from start to finish, using computer drawing tools like a tablet or a touchscreen with a stylus and various apps.
Sometimes there's a bit of both going on - an artist might create anything from a rough sketch to a nearly-completed piece of art, scan what they've created, then use digital tools to complete the work, whether it's fleshing out a rough draft or simply adding touch-up to something that was nearly a finished piece to begin with.
In the first and third scenarios, there would be a physical piece of art created by hand that was needed for scanning. In the second case, there's no physical art object that's created - the whole thing is virtual, at least until it gets printed at some point.
As far as preliminary sketches, that's entirely up to the style and preferences of the artist. Some artists might want to make references sketches to play around with design ideas, using traditional art tools and media, then make the completed work from scratch by going all-digital. Some artists might use such references sketches or rough drafts by scanning them and completing the work on the computer. Some might make all of their artwork digitally - references sketches and finished pieces. While I would imagine it would be easier for a digital artist to simply save a version of a sketch/rough draft and use another, identical version to complete the work, there may be artists out there that find it better for a given project to set aside whatever digital renderings they made in preparation and start from the digital equivalent of a blank slate, working from scratch on a blank digital canvas to make their end-result piece.
Did you have a particular reason for asking? That might help in terms of giving you a clear understanding of what you want to know.