Quote Originally Posted by DivaVocals View Post
If IH2 is installed correctly the watermarks should just work when you turn them on in the image settings. (Configuration > Images)

The size of the replacement watermarks is not important, though they should not be larger than the images they will be watermarking because they won't look good.

They do have to be in the right locations and they have to be named correctly.

From the readme. The relevant items are highlighted
Just tested custom watermarks on my test store. All my test watermarks are PNGs, and they are named with the EXACT SAME filename as the default watermarks that come with IH2.

You can see the result here: http://zentestcart.overthehillweb.co...Commodo_Dolore