Re: Image appears as icon only
This may not be your problem, but you get strange results when you upload a jpeg file to the File Gallery that is encoded CMYK instead of RGB.
Use your browser's "open file" to open the original jpg file. If you get a red x, the jpeg may be encoded CMYK.
In my experience, the CMYK encoded jpeg files will upload fine to File Galleries, will show a thumbnail after the upload, and will display a thumbnail pop up if you hover over the image name in the gallery file list. But you will get a red x if you try to display the file as an image on a wiki page, or if you select Display from the Actions sub menu in the gallery file list.
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