I see that you use the same system as Gravatar. First I don't see the point in using MD5 hash. It's not that the URL is not reachable... So there is no point in encrypting it, I guess (I might be wrong here).

Second I don't like the centralized word there. OpenID is supposed to be decentralized. That's what I don't like in gravatar. If gravatar.com goes down, everybody looses their avatar system. I see pAvatar and hAvatar as a better choice, being decentralized and "inside" your openID, no your are the owner of that Avatar (or you trust who owns it).

And I don't believe it's more simple for beginners. since all they want is a wordpress plugin, or another integration with the system they use. That way, they don't have to bother with it, and if OpenID providers provide an hCard (or pAvatar support) there is no trouble for the user.

Take a look at Four Starter's hAvatar Wordpress plugin at http://fourstarters.com/2008/02/09/havatar-updated-version-03/

That's a excellent way of doing decentralized avatar without any upload from user needs.