generate all thumbnails at once

It would be easy to implement, and easy to use a feature which resizes all pictures to thumbnails at once, so that the folders don't need to be 0777 all the time, but can go to 0755 or 0744 after creating thumbnails.

Re:generate all thumbnails at once

This is easy, just make sure you display all thumbnails on the first page and once the page has loaded you can change the display settings and permissions for the directory.

If you apply changes to the layout however (in the index.php file or the configuration) you will have to enable write-access again to see the effect....

As far as I can see there is no real issue with having 0777 privileges unless you fear someone gains access over your server....but then they will mess things up anyway ;)