I've noticed an issue when adding an image to the widget via searching the Media Library (as opposed to uploading a new image or navigating through Media Library pages to find a pre-uploaded image).
Two results occurred in my tests when using search to find an image in the Media Library:
- Often no image will show up in the widget or, if one was already successfully selected, the widget display won't change to reflect the newly selected image. Saving doesn't help and the old image or none will remain.
- Sometimes after searching for an image, the Image Widget plugin won't display "Insert into Widget" as the button title and instead will say "Insert into Post".
I'm currently testing on WP 2.9.2 but have noticed similar issues in WP 3 local MAMP install.
A reliable workaround seems to be manually paging through the Media Library, though this could be tiresome and a deal-breaker for people with really large libraries.
Note that the Image Widget is currently being used for the "Latest Release" info at a recent site: Taylor Maid Farms