You can use methods similar to those developed here:
http://www-ui.is.s.u-tokyo.ac.jp/~takeo/research/rigid/
What you do, is you define an MxN grid of control points which covers your source image.
You then need to determine how to modify each of your control points so that the final image will minimize some energy function (minimum curvature or something of this sort).
The final image is a linear warp determined by your control points (think of it as a 2D mesh whose texture is your source image and whose vertices' positions you're about to modify).
As long as your energy function can be expressed using linear equations, you can globally solve your problem (figuring out where to send each control point) using linear equations solver.
You express each of your source points (those which lie on your curved lines) using bi-linear interpolation weights of their surrounding grid points, then you express your restriction on the target by writing equations for these points.
After solving these linear equations you end up with destination grid points, then you just render your 2D mesh with the new vertices' positions.