Fading, hmm. Dunno*. Higher priority is stuff like "Next" and "Previous" links, and maybe a close button or something (since it's not immediately obvious how to hide the popup, and in my experience clicking popups tends to make bad things happen).
I would also like to do the thing Lightbox does where you can have more than one gallery per page, although I dunno how useful that'd be. Another thing that might be useful is adding a 'darkener' thing to dim the rest of the page.
edit: I also had an idea to examine the link to see if it contained a thumbnail image, and use that as a placeholder while the full image loads.
I've just updated it btw, so that it actually scales properly (i.e. maintaining aspect ratio).
* but only because I don't know how I'd do it :$ I'll have to look at how jQuery manages it - perhaps with some fiddling with transparency properties and such.EDITED: 30 May 2011 23:20 by CAER