jibber
I use Photobucket to host my pics, but I've never tried to work with the images there, so I've no idea what the options are. Always found it easier to work with the pics in MS Paint or Picasa on my PC, then put them on PB when they were done. (On the other hand, I only add a badge once in a great while, so it's not overly inconvenient.)
If the "wall" you're hitting is the 512-character limit in the sig, that won't give you too many strings. Combining all the badges in one image may be your only option, but I don't know whether you can do that "inside" PB or not.
The other possibility would be to use one of the many GIF makers available, to make an animated version that scrolls through the badges.
Sorry I can't be of more help. Hope you get the problem licked.