Well using memblocks could work, however i wouldn't sit down doing it from the pixel side, but would do it some other tricky AND easier way. Like making a high resolution plain object, what is textured with the picture to be modified. Lock it onto the camera and position it like it was put there with a simple paste image / sprite command... Then with memblocks / or simple vertex manipulation commands, plus the correct formulas, you can grab and manipulate the vertices to achieve the needed distortions.
This is kinda all theoretically what you need to know, but sorry i don't have time to write it for you. Get to it pal!
