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tedster - 1:30 am on Jun 4, 2008 (gmt 0)
If such links do generate some kind of "adult by association", then that would be a rather grim flaw in the algorithm. It would allow other webmasters to trash your rankings - at least on image search.
However, if hotlinking to your domain is causing a problem in Google Image Search (and we are not 100% sure that is the case) then redirecting, substituting images, denying access -- none of that would change the fact that there's a link out there, pointing to your site that Google can spider.