I've been all over catalog add new product, but I can't see how to make ZEN pick uip the pics from those folders. My only option with a pic is to browse my comps folder and upload, each and every one, by hand, one at a time.
You can FTP one or all the images i.e. _MED, _LRG, and the base image.

But in the product entry screen you must create the link to what image is to be used for this product one at a time and this info is stored in the DB

i.e.
image.jpg entered as the image for product "A"
another.jpg entered as the image for product "B"
etc.