Ok I'll take a shot at it.
Point A. Clip art is copyright free art (provided you've obtained it lawfully) so you can do anything you'd like with it. Distort it, change it, use elements of it, etc. It's like a font in that respect.
Point B. If the client is looking for original artwork to be used as a logo, he may be somewhat chagrined if he
buys your logo and then sees that same piece of artwork being used for another service company. Say it's the trees. And he's an arborist. Then another tree service, nursery, landscape architect, whatever, has those same trees as a prominent part of
their logo. Could be trouble.
Point C. If you're going to
sell the layout as a logo (and charge a fee for it) then my opinion would be that if clipart elements are used, they should not be dominant, or simply used as provided. Distort them, cannibalize certain portions of them, etc. I think that a client has somewhat of an expectancy to be getting a logo that is unique to him.
Point D. All of the above does not necessarily apply to a sign layout. Everyone knows that clipart is just that...clipart. So if a pictorial of a paintbrush, for example, ends up on two or more painting contractor's vans in the same town, well....that's just the way it its. (we would never knowingly do that)
Point E. So, bottom line is... if your sign layout, which was never meant to be a logo, is such a hit with him that he wants to use it as his logo...then I say tell him that it's possible that certain elements of it might not be exclusive to him. Whether you then charge him for the layout is up to you. Surely, the layout, letter treatment, letter styling, etc. could be very original. This I sense, is one of those areas that can be improved by frank conversation with the client.