Google's Image Search PM, Peter Linsley tweeted last night to me that Google's "Report images link has been dusted off and relaunched! The removal process should be much clearer now."
But! Remember that warning I gave you? Don't Search For Oreos On Google Images, You Might Get Naked Girls? Well, that warning is still valid even 8 days later. And the nude woman is ranking even higher.
Here is a picture of it with the report image feature:
For more on how the report offensive image feature works, see here.
Forum discussion continued at Google Web Search Help.