Banner Ads will not Display - Image code not generated?

[gameoverbeyond]

OK, so I have been at this for a couple of days, so time to ask for help

I'm trying to set up banners in my side boxes, these will just link to different pages on my own site, not externally.
I have followed the FAQ about 10 times now to no avail. I have ensured that admin/configuration/layout settings for the 3 banner display groups is set to banner1 (just the name I'm currently on). I have the banner group in admin/banner manager set to banner1. The banner is enabled, I verified the image is in the directory set (currently /images) and the banners will not show. The sideboxes do display, header image, title, but content is empty.

I have renamed the banner(s) images multiple times, and the current name in banner manager does match the current filename.
I have tried multiple images
I switched templates to classic to ensure it was not a template issue (currently using Abbington Mega)
I have renamed, deleted, rebuilt banner groups with multiple names
I viewed the site in Firefox, IE, and Chrome, all the same.
Found some old threads, I disabled my anti-virus and all ad blockers, still not visible.
I have no errors in my error log.

I did find that when viewing the blank sidebox content with firebug, there is html generating the appropriate link, but no image display coding is there. I cannot click the "whitespace". I did verify my tpl files in the template/template_default/sideboxes directory matches the original install files. I copied these to my override folder for sideboxes, still no change.
Screenshot below.

This is on my WAMP server, I'm using 1.5.1.

Any help would be fantastic and save my sanity

[gameoverbeyond]

Sorry, attachment issues

[gameoverbeyond]

OK, so a clear head and back at it. Further testing reveals this:
I can display a HTML banner, but still not a banner selected or defined at image setting in admin/banner manager/banner
I can move the html banner between banner groups and it displays in each box as defined in admin/configuration/layout settings
The banners that are created in banner manager that are defined via the image setting do not show, but, the banner views count in banner manager increases appropriately.
This leads me to believe there is a coding issue with the image generation coding. I have verified the tpl files in the sideboxes folder are original files and there are no overide files for these sideboxes in my template. I did attempt to clone them over just to check, but no change in results. I also tried the Contemporary Green Template again, cleared my browser cache, and still have the same issue.

What other files should I be looking at now?

[gameoverbeyond]

Anyone have any ideas? Still stuck.

[RodG]

Anyone have any ideas? Still stuck.

The images that aren't loading have a URL like "http://localhost/blahblahblah"

I can't tell you why this is the case, but I can tell you that this will never work.

Hope this is of some small help.

Cheers
Rod