Fixed this in 4.0.4
I removed the following code from postbit.css:
Code:
.postbit .content img, .postbitlegacy .content img, .postbitdeleted .content img, .postbitignored .content img, .eventbit .content img {
max-width: {vb:stylevar postbit_content_max_image_width};
_width: expression(document.body.clientWidth > {vb:stylevar postbit_content_max_image_width.Size}? "{vb:stylevar postbit_content_max_image_width}": "auto" );
}
The re-installed the product xml file and it works again