Hmm - We agree and work is already in progress and at a minimum in planning/discussion stage.
Remember - our first goal was easy, cheap, great quality without having to edit each result. This we accomplished. Next we are going to add multiple files processing so you can convert a ton of files in one pass in an automated fashion.
For number 1, I have code I wrote that actually makes a 3D model from a texture (using the same kinds of logic used for Knot So v1.0. This, for example allows you to load a brick wall and fly the camera around a 3D model of a brick wall face... and by adding functionality akin a terrain editor and using the resultant 3D "model" of the texture/landscape - we can generate normals from the individual points and take into account light direction as well. This particular code was written with DarkGDK and was actually a lot of fun.
For number 2 - this sounds like you mean allowing folks to edit more than one displacement map and then combining them and generating normals from that - I have to defer to you and David because I never heard the term frequencies used with normals - but I think I understand.
One thing that we were discussing was implementing a "displacement map editor" that would be like a 2D terrain editor that's pretty light weight... and I think this might be a natural for your #3.
Well, crazy bumps basically has a few things you can tweak and what not in the way of algorithm parameters and this will probably be the most definite thing piece that will be in version 1.1 at a minimum.
--Jason
[edit] Though we don't create a grayscale and make the normals from that the way you suggested. We gather as much information as we can from the color channels and create the normals from that the way that is recommended on every game developer site and reference book we used. This is important to specify I think and the results do look great with hardly any effort on the developers part.[/edit]