Same problem here. A little frustrated with 2.9.1 upgrade. I now am unable to insert images anywhere on my blog using the Image Widget plugin.I am able to insert static linked images from another websites. (http://newhottopics.com)I am able to see the images in the Media Library. I am able to upload images to the Media Library. I am able to select them to be shown. But when I click save it reverts back to the description text. I have checked to make sure the upload path is set to default in WordPress dashboard.