Whew. This is complex. I've made enought updates to a prior blog posting that I think it's worth drawing attention to: Gordon's Tech: OS X 10.4.2 does not fix Tiger's problems with Color profiles (ColorSync).
The bug may be interesting from a design perspective -- Apple might have been trying to improve color management for non-experts, but they ended up messing up their solution. The bug fix requires patches to both 10.4 and iPhoto together.