I don't know what these are called or when they started, I just know that they are done on 4chan (and possibly elsewhere) and I've seen several of them here on KYM. From what I've seen, most are from /v/. They come in two forms. In one, a static image is divided into rectangular tiles, users take turns redrawing/editing them one by one (frequently employing memes and other references), and they all get assembled back into the abomination they've produced. The other kind is a similar method, but with GIF's in which redraws/edits are made frame by frame.
Here are some examples that have made it to KYM:
This scene was apparently done a year ago too:
I think these are done often enough to warrant an entry, and it would be cool to have a gallery of these.