Well, you
were assuming Apple included all the basic functionality in their app.
(I shouldn't complain, iMovie finally lets me fade music at the end of a video.)
I've only recently played with iPhoto on my iPad, but I don't see a resize function either. If you really want this functionality, Filterstorm is a very powerful app. It also allows you to add canvas to the sides (or top) of a photo so that iMovie will allow you to see a whole portrait photo in one frame (another basic function missing). There's a lot more than that, but the learning curve may be a bit steep. I keep chipping away at it, and finding gems.