I've looked into this before, but it always circled back to the arduino simply having too little memory to be useful.
i found good alternatives though for my projects:
1. Arducam: this is a small serial interface camera that goes directly into the arduino IO. I guess this is more for a single capture or two, maybe ok for transmitting via wifi or xbee.
2. RPi + Alamode HAT: this was a really fun combination. the Alamode is an adruino that mates right to the RPi IO connector. That way I could grab and process images on the RPi, and offload all my IO things to the Alamode board. A nice bonus was that it also had a realtime clock with cr2032 backup battery :)
3. I've also got to plug the guys at GHI electronics. They build arm based board running .net micro framework. Once upon a time they even made an arduino clone board called Fez Domino. This had enough juice to run an rs232 camera that output jpgs. I tossed on my motor and xbee shields from the arduino and had a nice 'Mars rover' in a couple days. Their Cobra board was a big step up and could handle my webcam, and since then they've only gotten better.
.net micro is coding in C# also. It was a bit unnatural to watch this run on a microcontroller :), but oh so convenient!
i hope this helps!!
2016-10-15 00:48:58 UTC mattb - 104 points