The USGS orthoimage is a 6 inch resolution quadrangle that is loaded into GeoServer as a WorldImage. GeoServer has an extremely hard time processing this compared with a 1 foot resolution quadrangle. How can this orthoimage be edited?
Sounds like you want to resample your data. gdalwarp, part of the GDAL suite of tools, can do this for you, and it's free and easy to use. I went and found some 6-inch aerials, and resampled one from 6 inch to one foot resolution in both the X and Y:
C:\Temp>gdalwarp -tr 1.0 1.0 Adona_1.tif Adona_1-2.tif
This took the 6 inch resolution tiff of about 88MB down to about 22MB. I loaded them into QGIS, another free tool for you to use, and here is how they compare:
Not too shabby, actually.
World image is not a suitable format for web serving, use something like GeoTiff. With GeoTiffs you can create overviews which are exactly what you want, lower resolution versions of the image that geoserver will load at higher scales.
There is some good info in the user guide for this.