Aligning the bottom of a picture and a chapter title

I would use titlesec and its explicit option to design the chapter titles; two minipages with bottom alignment will take care of the alignment of the number and the title; something along these lines (feel free to adjust the lengths according to your needs):

\documentclass[svgnames]{scrbook}
\usepackage{fix-cm}
\usepackage[explicit]{titlesec}
\usepackage{tikz}
\usepackage{lipsum}

\tikzstyle{block} = [rectangle, draw, fill=blue!20, 
    text width=5em, text centered, rounded corners, minimum height=4em]

% the width of the box containing the chapter number
\newlength\mylen
\setlength\mylen{150pt}

\titleformat{\chapter}[display]
  {\normalfont\huge\bfseries}{}{20pt}
  {\begin{minipage}[b]{\mylen}
      \begin{tikzpicture}[node distance = 2cm, auto]%
        \node [block] (init) {\fontsize{80}{88}\selectfont\sffamily\thechapter};%
      \end{tikzpicture}
    \end{minipage}%
    \begin{minipage}[b]{\dimexpr\linewidth-\mylen\relax}
       \raggedright\sffamily #1
    \end{minipage}
}
\titlespacing*{\chapter}{0pt}{-50pt}{20pt}

\begin{document}

\chapter{Short Title}

\section{Rectangular coordinates} \lipsum[1]
\section{Projections of a segment on the axes} \lipsum[2]
\section{Distance between two points} \lipsum[3]
\section{The mid-point of a segment} \lipsum[4]
\section{Division of a segment in any ratio} \lipsum[5]
\section{Oblique coordinates} \lipsum[6]

\chapter{Title Which is Really Just Way Too Long}

\section{First illustrations} \lipsum[1]
\section{Curve plotting} \lipsum[2]
\section{Test that a point lie on a curve} \lipsum[3]
\section{Intercepts} \lipsum[4]
\section{Points of intersection of two curves} \lipsum[5]
\section{Oblique coordinates} \lipsum[6]

\end{document}

You could just use

\chapter[Title Which is Really Just Way Too Long]%
  {\parbox[b]{0.6\linewidth}{Title Which is Really Just Way Too Long}}

to put your chapter title in a paragraph box which is aligned at the bottom. I've also added a ToC entry that is not put inside a \parbox, since the ToC may handle the alignment correctly. The choice of 0.6\linewidth was just enough to make sure that the contents of the \parbox doesn't spill over the right margin.