Eric,
I am unable to right click on thumbnails. Nothing happens when I attempt to right click on the red X. I can add the images and they show up properly in the editor. It's odd that the thumbnail is displayed as red X; which makes me think that it cannot find the image. However, when I move the mouse of it - I can see the image and I can insert it into the editor properly. Please let me know what else I can try.
Thanks