Is GD definitely working, you aught to check phpinfo()
to make sure.
Yes, definetely. (Also checked gd_info() successfully.)
Try
$wgUseImageMagick = false;
The default settings file has this as false already but it
might have been changed
Done. No effect :-(
Does it display empty image placeholders where the
thumbnails
should be?
IE: empty image (red "X")
Firefox: nothing to see
Do the full size versions work when you click on the
image?
Yes.