After a bit more investigation...

 

If I save from the HTML view then editor.XHTML is correctly displaying

<p>wa<img height="83" hspace="5" src="/I/Images/RolledAluThumb.jpg" width="83" border="0" /> </p>

when Response.Write(editor.XHTML)

However if in Normal mode

Response.Write(editor.XHTML) gives
<p>wa<img height=83 hspace=5 src="/I/Images/RolledAluThumb.jpg" width=83 border=0> </p>

 

Mike