I'd take a good look at how the MediaWiki LaTeX support does it and borrow from there.
You could try the Online image generator for mathematical formulas for a start.
mathurl is a mathematical version of TinyURL.com. It allows you to reference LaTeXed mathematical expressions using a short url. For example, http://mathurl.com/?5v4pjw will show [LaTeX output Image] which you can then edit. More details on mathurl’s help page
As everyone has said, there are many services that do this already. Here is another easy one that I've used a number of times (and you can install it locally on your server if necessary):
http://www.codecogs.com/components/equationeditor/equationeditor.php
There is a modern service called "mathtran" which provides a robust and fast way to this sort of thing: http://www.mathtran.org/
The big caveat is that only TeX math commands are allowed; AMSLaTeX, in particular, is not supported.
Google Chart can do it (but it seems undocumented until now):
http://chart.apis.google.com/chart?cht=tx&chl=%5CLaTeX
I'm using this with Google Docs, because it doesn't support math yet.
I just ran across MathJax on Ajaxian:
MathJax seems to have a chance at being a practical solution that offers a high quality display of LaTeX and MathML math notation in HTML pages.
The output is remarkably beautiful, and it's all pure HTML and CSS, which makes it scalable and selectable. Performance is currently a bit sluggish, but this is recognized.