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Is there any way I can make it so that for the duration of someone's ban their avatar is temporarily changed to a different one?

I've never tried but I suspect you can set a default avatar for the Banned usergroup. Go to: Users and Groups > Groups > Banned > Options button > Edit Group > Group Image (enter URL)

this can be tried : [Tip&Trick] Default Groups Avatar

Or if you want to turn it automatically instead of running query each time, you may try this: http://yaldaram.com/showthread.php?tid=355