i think the best method would be how ETI handles it with a per-user preference, so you can choose if you want to see full in-line images or thumbnails, with a proper thumbnail generated so you donβt run into people uploading 40000x40000 images that then get dynamically resized or whatever
i think a decent enough hack for this as an immediate solution would be for the image code that is automatically pasted into the post box after you upload the picture would add a single > before it, which forces it to a thumbnail as if it were quoted