You maybe smoking something, but it doesn’t change the fact that you are right 😉 WP image management, (or should I say TinyMCE image management) is really sub par.
ImagePro
might be a good solution for you. Not only does it help replacing images in editor but also resizes them and displays a server-generated resized version of the image. Anyway, it’s nice for what it does. I personally used it on a couple of projects.