As a part of project scope we have to deliver to the Client digitized data sets – some houses and roads. Can we use USGS Orthoimagery from The National Map layer for feature digitizing?
Yes, you can definitely use USGS National map ortho-imagery to extract features, using heads-up digitizing methods (HUD.) The trick here is to work within a projected environment using UTM or State Plane as a coordinate system to ensure fidelity. Another consideration should be the age of the image. Ensure you are working with the most current image possible for feature extraction.
Regarding licensing: USGS does not restrict the use of their data but does require proper citation for re-use and derived products. Please read the following from USGS on the topic. http://www.usgs.gov/faq/categories/10154/3550
Orthoimagery from The National Map is technically already digital data. Regardless, you may conduct manual on-screen digitizing with USGS orthoimagery as a base to trace specific entities such as houses and roads.
Bear in mind the coordinate system of imagery and the feature class you are doing your tracing with to ensure they match while tracing. Also, some human error will be introduced while tracing due to visual acuity and pointing ability of the tracer.
If the location of the entities you are interested in are accessible to your organization and you have a access to a Global Navigation Satellite System (e.g., GPS) that has a better positional accuracy than that of the USGS Orthoimagery, you can conduct fieldwork to increase the accuracy of your work.