Normalized cross correlation for image registration is a feature I would love to see added. I've had plans to do this myself (plans in this case meaning something like 'pipe dreams') and somewhere on my desk I have some articles on the topic I could pass along. Unfortunately I have been unable to find the time myself.
You could compare the Matlab Image Processing Toolbox (at http://www.mathworks.com.au/help/images/functionlist.html) with Octave's current offering and see what is most easily added. I would like to see some good deblurring functions, better edge detection (canny etc, harris corner), and a decent wavelet transform (although this may be beyond the scope of the image toolbox, and should probably be part of core octave, or its own toolbox).
-Alasdair
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