Scott it's just about new.
I ended up rebuilding the page and it now works as it should but I'm still getting the black screen lockout during upload. I was able to work around that by right click/show desktop/show active windows. Cumbersome but it works.

You are just not having any luck today...

This could mean your registry settings have become corrupted somehow. What we will need to do is clear out all your registry settings allowing the software to default back to the initial settings. Please note that after doing this you will have to add your FTP information again.

Download this file here at http://www.coffeecup.com/files/binaries/vsdfix.exe to complete this task.

Next, right-click your Visual Site Designer shortcut icon and select Run as Administrator. This should properly launch Visual Site Designer for you. If it does, great! You can continue to launch the program in this way, or you can go a step further and configure the shortcut to always run as administrator. Here's how:

1. Right-click the shortcut icon, and click Properties.
2. Click the Compatibility tab.
3. Here, put a check mark by Run This Program as an Administrator.
4. Next, put a check mark next to Run This Program in Compatibility Mode For: and ensure Windows XP Pro Service Pack 2 is selected.
5. Click OK.

Once the above is complete, follow these steps:

1. Go to the Publish Menu and select FTP Account Settings and add your FTP Account.

2. Verify that all information is correct and the Remote Folder path is not empty. Typically you would enter in a / or /public_html here but you need to confirm with your hosting provider what the correct path is. IT IS ESSENTIAL THAT THIS PATH IS CORRECT.

3. Go to the Publish Menu and select Choose a Publishing Destination and select your FTP Account and then click Save.

4. Finally, go to the Publish Menu and select Re-Sync Website.

With any luck, everything should be back to normal.

Let me know how that goes!

Thanks for the advice Adam but Scott suggested I try exactly that procedure earlier. I had already set VSD (and the shortcut) to run as administrator a while back. The only glaring difference I can see between the way you and Scott recommend is that I had set my PC to run VSD as Service Pack 3 and nor Service Pack 2 as you suggested.

Earlier you were not having the black screen issue. Which this will correct.

You have to trust us here. Tech support works two ways Boyd.

Just to be clear, the black screen issue didn't start until after I had gone through the procedure that Scott had suggested and I switched to Service Pack 2.
I'll run through it again as you recommend and see what happens.
Thanks - Boyd

It started when you switch to S-Drive. We created VSD remember. That is why we know what is wrong.

As to the first issue you asked about on this thread. Where are you linking your images from? What folder on your computer?

Pics are sourced from a dedicated folder on my desktop. The folder is used to store photos for this website only.

So not from within the _website folder correct?

Correct Adam.

Your only option I think at this point is to migrate to RLM or the HTML Editor. I cannot see anyway for you to fix this issue within VSD.