Dynamic images are enabled, but this still doesn't work. It will not allow me to upload or link to an offsite php file (to pick random avatars). It says "Must be valid gif, jpg, or png."
No you would need to hack it. There is a reason you don't allow scripts in you members sig's and avatars, because these could be used to exploit your security. There is a unlimited amount of damage someone with the right know how can do to your forum with something like this enabled.
Highly un-advised, but if you still want the code I can track it down for you.