I've tried in both WP normal and WPmu so I don't think this is an mu problem. Also this site is my root site. I'm using a theme (fotofolio) that uses timthumb.php. The code calling the image is:
<img src="<? bloginfo('template_directory'); ?>scripts/timthumb.php?src=<? echo $image; ?>&w=70&h=70&zc=1" />
The resulting page source I get from my site is:
<img src="http://melissaretman.com/wp-content/themes/fotofolio3scripts/timthumb.php?src=&w=70&h=70&zc=1" />
Could this be a problem with WordPress 3.0.3?