Please have a look at my URL with the instructions you gave:
I have the following settings:
In the gallery tab this option is ticked, this kind of works but doesn't show the light box effect with a opacity bg and the image central, without it ticked it opens in new browser window which I don't want:
The gallery will open the ImageBrowser instead the effect.
In the effects tab I chosen 'lightbox' from the drop down, it generates this tag 'rel="lightbox[%GALLERY_NAME%]"' I have done nothing with it.
In my page I have this tag: [nggallery id=1]
Please help almost done.