I'm the developer of Group Text! app
(link).
There are two kinds if mass texts on the iPhone depending on the setting of the option "Group Messaging" on the iPhone settings (visible only if you're on AT&T).
The first, that is active if that option is ON, messages are sent as MMS instead of SMS (this means that some people can't read them), all recipients sees the other recipients and replies go to all recipients.
The other kind is a simple SMS sent to more than one recipient. This is what most users want. To send this kind of group texts you have to turn OFF the above option.
For pictures, no app that uses the new iOS4 In-App SMS is capable to send pictures due to how Apple has implemented the feature. All mass text apps that I found are using this feature to send messages so you probably will not find any app that can send pictures.
For group sizes, it really depends on the iPhone model you have. For example I was able to text to more than 350 recipients using my app and an iPhone 4. Users says they can text to 200 or more on the iPhone 3GS. On the iPhone 3G I suggest you to not use more than 100 recipients in each group.
Depending on the device the time needed to send a group text also change. Newer devices are a lot faster than older devices.
That said my app Group Text! is one of the option, if you try it and want help please contact me here or at the support address.
There are other apps and have to say I think a few are nice; obviously I think mine is better but hey it's my baby
