One way is to use these two plugins to create google+ style photo display http://www.sohtanaka.com/web-design/fancy-thumbnail-hover-effect-w-jquery/ and there are tons of other slider plugins available.By merging two we can do the respective work. But i dont want to reinvent the wheel.
Is there any plugin already available..??
This one seems to combine fancybox plugin with CSS gallery: http://tutorialzine.com/2009/11/hovering-gallery-css3-jquery/.
Also, this one also seems good: http://pikachoose.com/how-to-fancybox/
Few more:
http://www.no-margin-for-errors.com/projects/prettyphoto-jquery-lightbox-clone/
http://minishowcase.net/
http://visuallightbox.com/index.html
http://www.pirolab.it/pirobox/
There are lot in here, I suggested few that fit close to what you're looking for.
jQuery/CSS3 photo gallery tutorials
I know this is late. But there is a plugin which displays a list of images directly as a collage with drag drop etc.
https://github.com/sandeepravi/collage
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