One of our fellow SE-mods created a nice little userscript that gives you some additional options when uploading images.
When you upload an image using the SE uploading dialog, it gets uploaded in exactly the same size that the file is in. For large images, this can be a problem since they take up a lot of space and screw the alignment. The uploader doesn't allow for resizing (except by manually changing the URL to one ending in s, m, or l.
This script provides an improved upload dialog: