For what it is worth, I also ran it tonight (using an image resizer and optimizer plugin) on our shared web hosting site. It stopped at about 900 products on a timeout.
We're working with shared hosting for all things and it seems this plugin, along with some other plugins for resizes, causes pretty heavy load and timeout problems when using larger quantity of products.
I will probably try splitting this task up over the night, in chunks. Although, this was with the plugins already mentioned, it seems it is something we have to do at night.
I also got a lot of complaints about the size of our store pages (from non-techie people) as well. Led us to search for image resizer/optimizer plugins.
It looks like we will be having to do a chunking process since using such plugin is literally causing load and timeout problems with hosting companies and not always guaranteed. Also, it seems it is something to be done once a while. Would lead us into doing it by request and not being forced to load everything in one go.