Thanks for a great hack Steve!
I, like everyone else, experience the delay when remote images are resized. I would like to make a suggestion I found incorporated into similar hack for phpBB. The author assigned "ids" to remote images that were resized and stored the resize information in the database. By doing so, images only loaded slow the first time. Afterwards, the images would load at typical speeds because the orginal and new sizes were already stored in the database. If the table became bloated, it could simply be purged without effecting the linked images and the process would continue. I used this on a phpBB site and it made a dramatic impact on load times. I don't know if this can be incorporated into this hack, but if your interested here is a link to the MOD.....
Limit Image Width
Brian