This is my latest version. It can do the whole cropping thing by moving the currently cropped object to a cropping layer and after the cropping is done the object will be moved back to the original layer.
You can also change the absolute size of the cropped image and test image movement. I also added tiled background object that can be used to "frame" the cropped image, which can be used to create a nicer graphical effect.
The only limitation that seems to exist is that you should not simultaneously crop overlapping images, but it's ok for the images to overlap otherwise if only one of them is being cropped at a time. Even that could be solved by adding extra cropping layers and always only having one image being cropped in one cropping layer, and even that is only needed if those images are overlapping while both are being cropped.
There seems to be a weird z-order bug when the image is being moved back to the original layer. That could be solved by more complex Z-order sorting or maybe someone can find what is causing the issue, which would be nice. But the core mechanics seem to work as intended, which is most important.
File:
dropbox.com/s/ckdcogwitbcbvjt/ExpandingImageTrick2.c3p