I’m scaling images down in c#, and I’ve compared my methods with the best method in Photoshop cs5 and cannot replicate it.
In PS i’m using bicubic sharper, which looks really good. However, when trying to do the same in c# I don’t get as high quality results. I’ve tried bicubic interpolation as well as HQ bicubic, smoothing mode HQ/None/AA. Composition modes, I’ve tried about 50 different variations and each one comes out pretty close to the image on the right.
You’ll notice the pixelation on her back and around the title, as well as the authors name not coming out too well.
(Left is PS, right is c#.)

It seems that c# bicubic does too much smoothing even with smoothing set to none. I’ve been playing around with many variations of the following code:
g.CompositingQuality = CompositingQuality.HighQuality;
g.InterpolationMode = InterpolationMode.HighQualityBicubic;
g.PixelOffsetMode = PixelOffsetMode.None;
g.SmoothingMode = SmoothingMode.None;
Edit: As requested here is the starting image (1mb).

Perhaps I am missing something, but I have typically used the following code below to resize/compress JPEG Images. Personally, I think the result turned out pretty well based on your source image. The code doesn’t handle a few edge cases concerning input parameters, but overall gets the job done (I have additional extension methods for Cropping, and Combining image transformations if interested).
Image Scaled to 25% original size and using 90% Compression. (~30KB output file)
Image Scaling Extension Methods:
Compression Extension Method:
Usage:
NOTE:
For anyone who may comment, you cannot dispose the MemoryStream created in the Compress method until after the image is disposed. If you reflect in to the implementation of Dispose on MemoryStream, it is actually save to not explicitly call dispose. The only alternative would be to wrap the image/memory stream in a custom implementation of a class that implements Image/IDisposable.