Blank header image

I am using a 3-column kubrick. I have built a couple of sites with it… has been working great, until now.

I have a domain with two different blogs in subdirectories of the same domain:

http://www.mydomain.com/blog1
http://www.mydomain.com/blog2

Blog 1 is perfect and shows the header image. Blog 2 is blank. I have completely uninstalled WP 3 times, double checked to see if all files are prestent, including all image files. Everything is exactly the same between the two blogs, except for the blank image on the 2nd one.

Any ideas in proceding forward to fix this?