This plugin provides you with a widget to display images from a feed. It requires the SimplePie plugin to be installed.
Usually any problem is related to the cache, and write permissions to that cache. Check the permissions for
The other issue could be that your feed doesn't have enclosures. If you don't know what this is please read this: http://en.wikipedia.org/wiki/RSS_enclosure
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Weren't you paying attention? Read the Description again!!!