you can't have people upload to their own site because of the way the server works. even if you upload your avatar to an external source (like tinypic, etc) in order to use it on the forums it still gets uploaded to the forum database. as said in the past, it's not necessary to the forum for everyone to have custom avatars and it would take up way too much space.
There is a way in VBulliten to make it work. That's why it taking up too much space on the servers is irrelevant. We dont need to use the sites servers