I’ve got the div class issue figured out. In a nutshell, edit kses.php.
To make img tags work, add a space and close the tag.
For more detail, read my post about it.
External Posting Errors in WP 2.0
Gappiah, I have a step-by-step for how to set up multi-blogging on my blog, including a script to automate all of the setup.
Multi-blogging made easy
