Dave,
The ?geometry=wxh parameter capability is added by the xowiki link-procs. As such I think it probably only works with images retrieved through xowiki, although I am not certain of this yet.
The re-sized images are cached in a temporary directory. Eventually this will have a max_size limit and a clean-up process which should address the denial of service issue (good point though!).
If it all works well it might be worth extending the functionality to the base CR code you added.
At the moment I am adding the paramaters and will post back when finished.
Regards
Richard