[MPDev]

I don't have the exact code you'd need to place in the file, like I said, you'd have to modify the script to use the watermark.php sciprt in place of the URL to the actual image.

As for allowing dynamic images, I'd say that you should research the issue. I'm not sure that its really a bad thing, but others may disagree and I wouldn't want to tell you to undo something that may be a risk to your site without knowing more about it myself. (Even dynamic scripts can be used when its disbaled, such as my signature listed below).