Based on helpful comments from Matt on this previous post:

How To Resize Uploaded Images Using Java

I have upgraded the image resizing code. The results are noticeably better in quality, even at thumbnail sizes. I wanted to share the completed new code, in case anyone needs it.

Again, thanks to Matt S. for his pointers.

    /**
     * The JAI.create action name for handling a stream.
     */
    private static final String JAI_STREAM_ACTION = "stream";

    /**
     * The JAI.create action name for handling a resizing using a subsample averaging technique.
     */
    private static final String JAI_SUBSAMPLE_AVERAGE_ACTION = "SubsampleAverage";

    /**
     * The JAI.create encoding format name for JPEG.
     */
    private static final String JAI_ENCODE_FORMAT_JPEG = "JPEG";

    /**
     * The JAI.create action name for encoding image data.
     */
    private static final String JAI_ENCODE_ACTION = "encode";

    /**
     * The http content type/mime-type for JPEG images.
     */
    private static final String JPEG_CONTENT_TYPE = "image/jpeg";

    private int mMaxWidth = 800;

    private int mMaxWidthThumbnail = 150;

.....

    /**
     * This method takes in an image as a byte array (currently supports GIF, JPG, PNG and
     * possibly other formats) and
     * resizes it to have a width no greater than the pMaxWidth parameter in pixels.
     * It converts the image to a standard
     * quality JPG and returns the byte array of that JPG image.
     *
     * @param pImageData
     *                the image data.
     * @param pMaxWidth
     *                the max width in pixels, 0 means do not scale.
     * @return the resized JPG image.
     * @throws IOException
     *                 if the image could not be manipulated correctly.
     */
    public byte[] resizeImageAsJPG(byte[] pImageData, int pMaxWidth) throws IOException {
	InputStream imageInputStream = new ByteArrayInputStream(pImageData);
	// read in the original image from an input stream
	SeekableStream seekableImageStream = SeekableStream.wrapInputStream(imageInputStream, true);
	RenderedOp originalImage = JAI.create(JAI_STREAM_ACTION, seekableImageStream);
	((OpImage) originalImage.getRendering()).setTileCache(null);
	int origImageWidth = originalImage.getWidth();
	// now resize the image
	double scale = 1.0;
	if (pMaxWidth > 0 && origImageWidth > pMaxWidth) {
	    scale = (double) pMaxWidth / originalImage.getWidth();
	}
	ParameterBlock paramBlock = new ParameterBlock();
	paramBlock.addSource(originalImage); // The source image
	paramBlock.add(scale); // The xScale
	paramBlock.add(scale); // The yScale
	paramBlock.add(0.0); // The x translation
	paramBlock.add(0.0); // The y translation

	RenderingHints qualityHints = new RenderingHints(RenderingHints.KEY_RENDERING,
		RenderingHints.VALUE_RENDER_QUALITY);

	RenderedOp resizedImage = JAI.create(JAI_SUBSAMPLE_AVERAGE_ACTION, paramBlock, qualityHints);

	// lastly, write the newly-resized image to an output stream, in a specific encoding
	ByteArrayOutputStream encoderOutputStream = new ByteArrayOutputStream();
	JAI.create(JAI_ENCODE_ACTION, resizedImage, encoderOutputStream, JAI_ENCODE_FORMAT_JPEG, null);
	// Export to Byte Array
	byte[] resizedImageByteArray = encoderOutputStream.toByteArray();
	return resizedImageByteArray;
    }