> > What I would like (PDF)TeX to do in case the image is too large, is scale
> > the image so that it will fit on the page.
>
> Maybe following can help you:
what's wrong with
\includegraphics[width=0.8\textwidth,height=0.8\textheight,keepaspectratio]
{file}
does that not do what's desired (i've never tried precisely that
formula)