If you do a View Source on the resultant page, what do you see. Is the img tag there, with its attributes, and it just can't find the picture? Or has the img tag been stripped from the output altogether?
when i add a img tag into the product description (html body) code it produces no output, i cant see the image and also the text (<img src="...">).
and, when i do a View Source on the product page: img code is not there, and one more i have just discovered, when img tag is inserted properly without any syntax errors( i have made some to check what happens) it is (the code) filled with spaces, so instead of for example <img src='one.tag.gif'> i get 23 spaces in the html body in admin, and nothing can bee seen while Vie Sources option was choosen.
Use single quotes not double quotes.