Last time I checked out Image Events I didn't have much luck, so I'm not sure.
But this line looks like there may be something wrong with it:
set this_image to open file (i as string)
i should already be of type alias, since the open handler is passes a list of alias. So just "open i" should work...
BTW, Apple has some examples for scripting Image Events up on their website now. There's also some examples preinstalled for use with Folder Actions.