Hello William, Please make sure the following are done:
1. You have folder for images on your server. You can also try to change CHMOD for this folder from typical 644 to 777 via FTP. It is important that this folder is outside cgi-bin directory.
2. You set up proper server path to the above mentioned folder with images under you shopping cart settings:
Settings > Basic Cart Settings > Server path to the folder with images
Use link next to "Server path to the folder with images" for more information.
3. Make sure you have Imagemagick enabled under:
Settings > Cart Database Settings
4. Most importantly, if you are not sure check with your hosting server support that Imagemagick PERL module is in fact installed on your server.
If the above fails to work, e-mail your FTP access to our support and we will try to diagnose the problem further.