Same problem. Does anyone have an answer?
Found a temp work around. Use top button to “Add an Image” next to “Add Media”, copy “Link url” for ur image, then use “Insert/Edit Image” button from icon toolbar in Post dialog box, paste in url, then insert image & voila!
Extra work, but a temp fix that gets the image in.
GreenEnergyForEarth.com
Have same problem w/ wp 2.5. Worked for 2 wks, then stopped working in both IE 7 & FF 2. Images are from local file uploaded, crunched & then seen in gallery & media. Get blank dialog box & msg “Done’ in lower left corner. Tried both IE & FF from desktop & laptop. Same neg results. Tried login w/ my login & w/ other admin login. Same results.
Sorry to hear that 2.6 didn’t solve this as that was my next attempt.
Hope someone has positive results.