I have just inserted a transparent background image into Pages v14.4 on iPadOS v18.5. The selection lines are thin blue lines representing the bounding box around the transparent background. Is the blue line that you describe this normal selection line or a thicker blue line (which I cannot reproduce)?
With the normal blue selection lines, I can choose the right-lower grip and with one finger press and drag diagonally to increase or reduce the proportional image size. I can also click the paint brush toolbar icon and that presents a Style, Image, or Arrange sidebar allowing me the ability to resize and reposition the image, or even rotate it.