can you please try this:
1) Please change in _default.xml the <resource name="on">on</resource>
to <resource name="on">TEST</resource>
2) Please double click an image. The ~/Dialogs/Tag.aspx?Tag=IMG will be poped up.
3) Click on "Browse" (~/Dialogs/SelectImage.Aspx will be loaded)
4) You see that the on still appears in "Auto resize uploaded mages function is on"