I'm fine with a country flag. I'm also OK with an avatar...anything that ads a more memorable characteristic to a (sometimes not very descriptive) name is a good thing. People can always turn the nonsense off from day one if it's really that offensive to them.
With respect to load times, I can assure you that smileys don't significantly impact the experience. On FT, all the <img> tags that refer to smileys use the propert alt attribute as well, so all modern browsers render the page fully before loading the smiley images. The same would hold true with regular images and avatars in posts...a placeholder appears as soon as the text is loaded, and the browser will then and only then retrieve the images while the user is free to go about their browsing experience unmolested and undelayed (note this is dependent upon correct implementation of the image tag, which I have no doubt IB is capable of).
See? The problem has already been solved.
Edited to add: People, you do understand that your avatar can only be put there by you, right? It's not like someone else can go uploading photoshopped images to your profile or something. And again, speaking as a moderator on both this board and others were avatars are allowed, I see no risk.
I think it's a bit disingenuous to suggest that FT is somehow unable to make people understand they can turn that feature off if they want.