Dreamhost is very good for "starting" an imagehosting website. If you are getting more and more traffic, and are use more and more Cpu/hd/ram they will ask you to move to there VPS solutions which is VERY expensive.
The policy of Dreamhost states that u cant use there hosting if you are setting up your website for storage solutions (image,files etc). But if you dont have alot traffic they wont bother you.
So my tip, start using dreamhost for setting up your imagehosting website. Then when u start getting more and more traffic (5000++ unique a day) switch to a dedicated server or VPS from another hosting provider. At the moment im using w w w. hostineuro .com and im statisfiedwith there great price/quality ratio.
Another tip, dont use MYSQL on dreamhost because its slow.