I have added Paul Schaeflein's ImageUpload Web Part to my Resource page. Paul posted about his web part in response to my SharePoint vision rant. Thanks Paul for your contribution!!!
The ImageUpload Web Part displays a form with a file upload input box. The end user can click the browse button and select the image. The web part stores the image in a doc library and automatically remembers the location and renders the IMG tag correctly. Cool web part!