The only problem I can see is what Sicloan was hinting to.
As long as all images are in limits it should be ok, but as the trend catches on, I can see a few members taking advantage ocassionally and slipping in a huge pic.
It could get hard policing it, and I can hear themembers reply of "Look at the pic, it's below size", when after 10 refreshes the suspect pic returns.
Since it takes a server that uses php technology, I don't think we have anything to worry about though.
And with a few adaptations, I would like to try it on a banner in one of the test skins....
Imagine a banner that changes everytime you enter the forum.
Blizzforums is using similar, but I thought it was part of the VB3 skin.