Just a couple observations: 1) The English words chosen for the various fields in the UI are not very amateur (non-professional/non-educated) friendly. 2) The ability to hang Inkscape unintentionally if an image is not small enough (with no related warning) is disconcerting.
Granted, I didn't use small art as one of the first searches turned up when using the terms "8-bit zelda" was at a much higher resolution... which seemed like a good reason to test it. It seems like it should operate with relatively similar speed, regardless of size, when you're just dealing with interpreting "blocks" (granted I know on a technical level it's pixels, but uneducated users may run across something like
http://fc07.deviantart.net/fs70/i/2011/340/9/3/link_the_legend_of_zelda_8bit_full_hd_by_racamo7-d4id3wn.png and say "well, it's pixel art" because they're just looking at the blockiness of it and doing those simple searches). Again, I understand the technical meaning of pixels and what the intended functionality is, but perhaps if an image above a certain resolution is detected as the selection, the dialog should show a warning about the amount of time it may take.
Very nice results otherwise from my limited testing. :)