Reposted from the Computer Forum since it seems to be a regular question
Powertoys for Windows XP includes a very useful image resizer. This is integrated with the operating system so that right-clicking on an image file in Windows Explorer (or group of images) gives you a drop down menu item 'Resize Pictures'.
This in turn gives you several defaults and a custom option for the new size.
It produces a resized copy and does not alter the original (unless you tell it to!). I would not advise ever changing the original. The resized images are stored in the same folder as the original.