I use 125mm cranks on my recumbent, a Challenge Taifun. Mike Burrows cut mine down and I'll echo harrumph's comments, he does a very good job.
Prior to making the leap full time I used some SJS adjustable crank shorteners to play with various lengths, and this was very helpful when trying to settle on a final length. I'd recommend a period of experimentation to anyone considering a move to shorter cranks, if the right hardware can be begged or borrowed.
Your gearing will definitely change when you lop a chunk off your cranks. You'll have less leverage and so it'll feel like you're pushing a bigger gear (in fact, you will be). If you want to retain your current effective gearing, then you're right to expect to have to change something, and that chainrings are the obvious candidate. As you said though, you don't have much room for manouvre, what with your current 24 tooth ring.
For me, my bike was low geared as it was (due to 406 sized wheels), so the new crank length gave me the extra top end that I needed, and moving from a double to a triple with granny ring retained the low end.
You'll not be able to work out the exact adjustment you're going to need until you decide what new length of crank to plump for. The more you chop off, the bigger the difference you'll need to compensate for.
Like you, one of my reasons for switching was to see if shorter cranks might help with my knee pain. As it happened it made no difference for me, but of course you may have more success.
You should definitely find that you spin faster, and more smoothly. This comes naturally because your feet have less distance to travel per revolution, but I found this a mixed blessing. Whilst spinning is more fluid, I also felt robbed of some old fashioned grunt. I'm a big bloke, with big thighs, and always had the habit of giving the pedals some welly when I needed extra umph for hills or acceleration. With significantly shorter cranks, it feels much harder to translate blunt force at the pedal into momentum, so you may find you need to adapt your style somewhat. If you need more power, you have to develop it by spinning up faster, rather than mashing out a few big strokes. Unless you can adapt your pedalling style, you may find yourself pushing harder on the cranks to compensate, and that might be counterproductive for your knee pain. Just something to bear in mind.
*edit*
Oh yes, and remember that when you shorten your cranks, you'll want to also experiment with different boom length. Most likely you'll end up tweaking it a little further out, to keep your leg extension the same.
