I didn't look at your example very long but perhaps you'd be better saving the pic using a for loop for the y axis, BlockWriting each scanline in turn (because the padding might screw up things, not sure).

Check out this page on EFG's site: http://www.efg2.com/Lab/ImageProcessing/CryptImage.htm. If you used that then you could apply it once and use SaveToFile/LoadFromFile without any more fuss. XOR encryption isn't the strongest in the world but it'll do for starters. You can always add different, better encryption to the whole file using a block cipher later on.