The only change we have made is that the person responsible for uploading images found a shortcut. They started uploading only 1 image through IMH2 and then renamed all other images to the IMH2 naming pattern then uploaded them through the server via FTP. I do not know if there is a process that each and every picture has to go through by uploading every picture manually. This is the only change. We have not installed any new add ons (modules). We have not modified the stylesheet, etc.
well Iam not an expert in Zencart at all, less in IH2, but I am confused, because in IH you dont have to upload any images through FTP...
If you want to add images you do it via IH and you dont even have to rename anything, because IH does this for you.
Just an idea which may cause the problem, but I am not sure whether I understood you right.

Hope this helps.

Regards,
kruna