I tried using this but the avatars were appearing on left hand side. So ichanged my css to align it to right. But when i try to upload new avatar it again appeared on left side and thus distorting the UI. What modification I need to do so that every time newly added avatar should be aligned to right.

That's normal, avatars are supposed to be on the left. If you have a non-standard style, this probably isn't going to work for you.

Is there a similar mod like this around where the thread icon is determined by the forum the thread is in?

How do I remove the Greyed Out? Cause the icons look so faded..

also what is the blue border around the icon? what does it mean

The border is used to highlight a hot thread, it can be disabled in admin>options or the color of the border can be changed in the stylevar.
The grayed avatar i have noticed it but it didnt bother me enough to look into it but i think the Hot Thread color has some bearing on how faded it looks, try disabling and take a peek.

After installation got me this "message"

Compiling Templates

FORUMDISPLAY
search_resultlist
search_threadbit
threadbit
threadbit_deleted
USERCP_SHELL
FORUMDISPLAY
search_resultlist
search_threadbit
threadbit
threadbit_deleted
USERCP_SHELL
USERCP_SHELL

Is that normal, guess not...so this means i will have to manually re-compile all of that :[ ?

What was compiled there, if uninstall this modification of course problem will persist...so to revert templates or...please advise

Edited:
As "KGI_Bling " was saying in post 379 here... I also have same problem, if user don't tick "remember me" upon logging in he will see only no_avatar/default avatar icon same as he dont have avatar on forums

Running VB4.2
have one more modification related to avatars and thats: Avatar in a header

Thank you for this neat modification

ps
is it possible to get this modification without copyright?

It's normal for the compiling messages... it will recompile the proper templates when you uninstall.

At some point there will be a non-attribution option available, but it's not available yet.

You mean that I just leave it as it is, or to uninstall than again install your modification ?

Not planing to uninstall your mod for good as I am sure my users will love it, on other hand I guess that these parts of forum do not affect that much on server resources?

Thank you for your quick reply

Not sure what you are asking... if you want to use it, leave it installed... if you don't, just uninstall it.

If I uninstall, than after that install again your modification...will this resolve issue [if it is] with "Compiling Templates", than upon second installation this "Compiling Templates" will not be there any more? That was question, will re installation help?

Pardon for my knowledge, regarding coding and VB is not on a lvl that maybe should be...only I never saw that any modification did something like this before, did install and uninstall at least 100 of them
Not one of them had : "Compiling Templates"