We are making using of image renditions on our websites. We do not like the fact that the ThumbnailManager does not respect the image type that we have checked in in turn has png hard-coded as the extension of all the renditions that are kicked back. Support explained to us that the reason that this was done this way was because, "According to R&D this was done as PNG is the most optimized format for the web." Our expectation is that if we choose to check in a jpg, then the rendition should be returned to us a jpg, not png.
The main concept here is to extend ThumbnailManager and override with your own implementation with you favourite image resize component.
BUT YES, the build in Thumbnailmanager "as is" is not to be used. Since the the thumbnails even get larger then the original uploads.