Thankfully, I've not had such a problem - or at least, haven't noticed it. Perhaps, it's because I haven't published anything of particularly high value.
In terms of preventing copying, I'm not sure that there's much you could do pro-actively. If you've not already got copyright warning messages, then you should put them on stating that you reserve all rights. However, a determined copier will simply ignore them.
I regard dissuasive 'features' such as blocked context menus and 'white' text instead of spaces as non-solutions. They don't solve the problem and serve only to drive away genuine users of the websites - e.g. context menu javascript traps cause problems with scroll wheel/button use, and hidden text screws up screen-readers for visualy impaired users (in fact, this may even be illegal for commercial sites to do this, under disability discrimination law).
Once someone has copied your work, there's not a lot you can do, other than tell them not to and resorting to the DMCA. At least in the US, the DMCA is reasonably sensible, in that it allows the ISP to remove the content immediately, unless the violator issues a legal document disputing the violation. Few people will lie on such a document, if the violation is flagrant, as yours appears to be, as when they are found in violation, a court is likely to take a dim view.
In other countries, legislation is variable, and ISPs may have policy about what they are willing to host, and what they aren't - which may not even be consistent with others in that country, and how they choose to deal with copyright issues. It goes both ways, some will remove first, ask questions later - some may refuse all contact and tell you to deal with the site owner.
Watermarking of images is an interesting technology, and one that I have thought about using for my photographs - however, it is quite expensive and it doesn't deal with the problem of people stealing your images. What it does, however, is remind them that the work is copyrighted and that you can easily prove it. There is now a watermark webcrawler, which scans images from the web and checks them for watermarks - this allows you to get a list of every URL that shows one of your watermarked images - but it's even more expensive. I see it as most useful, when you've got photographs that are most valuable outside of the context they are in on your site. e.g. stock photos, news photos, etc. The other problem with them is that they degrade the images slightly - while the artifacts will disappear in photos, they may be quite visible in illustrations. So, it would not have helped in the situation you are currently in.
If someone has ripped you off, they won't back down, and you can prove it - I'm not sure that there's much you can do other than threaten, and then carry out legal action, under the advice of a suitably qualified lawyer.
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