My app is heavily effected as well. I have a Picasa client that auto-caches photos for users. The app manages the cache and clears it when needed, but certain albums can be manually set to cache by users so they're never deleted. I wouldn't want all these photos backed up and I don't think apple would allow it. Them going through and deleting the data themselves basically breaks the app for our users though.

The app: webalbumsapp.com