Wanted to share how I addressed this issue.
I'm currently running osclass 3.1.1, was working find on version 3.1 as well.
The basic idea is I just wanted to resize the images getting uploaded rather than crop to a size. This allowes me to use css to handle the images without having to deal with the background color generated when the image is overlayed onto a new image during upload. You can see the end result here:
http://duramba.com. As far as sizing the image, that can be done to your taste using css...i.e. fixed aspect ratio for all images.
I haven't tested this with ImageMagick on yet, I'm currently using GD library.
The change i made can be found here:
https://github.com/N00SA/OSC-311/commit/707d88ec6c80324fb1f457cc42b98b4cfb40ba6c Note: This is the only change needed to remove the whitespace, 2 lines. Once the whitespace is removed, you are now dealing with a scaled version of the image. Using css, you can crop and fit to your needs.
Hope this helps. If you have an idea to improve upon this, please let me know.