best method to resize images

have a situation where clients will be uploading images via a web interface.

We need to process these images to create thumbnails. In the past we have used
image____ but have found that the output is somewhat less than desireable and
limited to jpg.

We would like to be able to soften the image prior to resize so it is a little
clearer in the thumbnail, as well as have the option of working with gif, png,
etc...

Comments appreciated.

Dave