What about using the Beagle Board?
3.) Micro-SBC like "Raspberry Pi". Put your program and OpenCV inside that thing. Story end. (And it's $25, if I'm not mistaken)
...it's about 80mmx50mm...
Man, these options are great. Computer-based, Linux, small sized, and am sure Python supported. This guy with uCs as 'limbs' extensions, intelligence everywhere. Gosh, I'm in for it man. Next generation controller, save a LOT of efforts in computer software development. Okay, truth be told, I quite enjoy designing robots, control programming etc etc but don't quite like custom computer software development.

Guess these board can kills 2 birds with 1 stone.

Bye bye PICs.
I would recommend (3) but that Rasperry-Pi isn't in the stores yet.
FYI, Estimating Feb 2012, saw from FAQ of the web.
An image recognition method by Viola-Jones (in OpenCV it's called Haar Classifier) will be easier on those smaller high-end processors. However, you may need to write these routines, including the Adaboost (another machine learning algorithm), all into the FPGA or the into the processor. Plus, you may need to train the system to properly recognize the object too.
Neural-networks is also okay, but the difficult part is to train the system. You need many samples of the thing for the system to successfully detect the object.
There are other straight forward methods if you just want to simply see whether both images match each other or not on these system. You may check "correlation" algorithm in the Google, and implement this into the system as well.
wow, I need to salute you for your expertise. Well, I'm just a rookie for image processing. My last attempts is very pc-based using Roborealm, recognizing color patterning. I'm moving up to OpenCV due to as usual, cost. However, I'm not going to give up due to learning curve, never will.

1.) FPGA - Hardware descriptive language on image recognition technique implemented inside the system. All in one. Use the PIC32 as a central system - it gets the results from the customized solution and displays it on elsewhere. (Match or no Match? on screen, as an example)
I'm curious, is FPGA learning curve steeper than, says, coding assembly for PICs? (I'm okay with assembly coding, in fact, quite enjoy the style of thinking). I'm completely blank for FPGA and definately needs 101.
Well, learn a lot today. Thanks guys. =)