As a knitter, this sounds truly awesome. Seems to not work though. But I'd love to collaborate with you on this, since it's something I need as well at times and never thought to make (I tend to draw charts directly for my own designs, but far too many published patterns have instructions only). Interested in the reverse transform? Webcam integration for pattern reading?
But, today I wrote a tool for my fiancee to help her make knitting charts. Very minimal, but it's a start.
http://knitting.heroku.com/