I have a number of images where I know the focal length, pixel count, dimensions and position (from GPS). They are all in a high oblique manner, taken on the ground with commercially available cameras.
What would be the best method for calculating the euclidean distances between certain pixels within an image? If it is indeed possible.
Assuming you're not looking for full landscape modelling but a simple approximation then this shouldn't be too hard. Basically a first approximation of your image reduces to a camera with know focal length looking along a plane. So we can create a model of the system in 3D very easily - it's not too far from the classic observer looking over a checkerboard demo.
Normally our graphics problem would be to project the 3D model into 2D so we could render the image. Although most programs nowadays use an API (such as OpenGL) to do this the equations are not particularly complex or difficult to understand. I wrote my first code using the examples from 3D Graphics In Pascal which is a nice clear treatise, but there will be lots of other similar source (although probably less nowadays as a hardware API is invariably used).
What's useful about this is that the projection equations are commutative, in that if you have a point on the image and the model you can run the data back though the projection to retrieve the original 3D coordinates - which is what you wish to do.
So a couple of approaches suggest: either write the code to do the above yourself directly, or probably more simply use OpenGL (I'd recommend the GLUT toolkit for this). If your math is good and manipulating matrices causes you no issue then I'd recommend the former as the solution will be tighter and it's interesting stuff - otherwise take the OpenGL approach. You'd probably want to turn the camera/plane approximation into camera/sphere fairly early too.
If this isn't sufficient for your needs then in theory going to actual landscape modelling would be feasible. The SRTM data is freely available (albeit not in the friendliest of forms) so combined with your GPS position it should be possible to create a mesh model in with which you apply the same algorithms as above.