Non-core and read-only stream wrappers like http://drupal.org/project/remote_stream_wrapper and http://drupal.org/project/system_stream_wrapper want to use Drupal's image style derivative generation by getting the image from a source from the stream wrapper but store the derivative in the public file system. There is currently no way to do this without duplicating several image.module functions and delivery menu callback.
This could easily be solved with a simple alter hook for image_style_path().