You are a life saver. This is exactly the plugin, I was looking for.
However, I have a few questions. I am uploading my images, using a plugin Simple Post Thumbnails. I am basically storing the thumbnails or your images in a folder and using this plugin to call that image to display on the post or the index page.
Now, can your plugin, offload these thumbnails to imageshack? and when requested, can it replace the image url to display from the corresponding imageshack url?
I have got like 35K image thumbnails to be offloaded in this manner.