I don't think IReport (or actually JasperReports, which it uses) have any capabilities to alter images. You'd need to do that in code of your own before including an image in the report.
There is a "page background" feature you may be able to use for watermarking, though.
4.set a band height (e.g. half page-height, or even whole page-height --> see report properties (paper size) depends where you want to place your watermark)