Crabby, chances are you are trying to use a crappy free server to store your pics. Well, not crappy, necessarily, but kind of unfriendly. Many free web hosts will only let you download images (and other files) when they are referred to by an HTML file on their site. Some will simply refuse to let you view the images remotely (giving you the red X in Exploiter, and the broken image icon in Nutscrape) and others will show you a default image, usually the hosts's logo.
So... either use a pay-host, like the free webspace that most ISPs give you, or find one of those elusive elusive free hosts that lets you remotely view images. There aren't many of them, unfortunately.