Since the album works fine under my account it might be that you altered the photo height and width under your usergroup.
See usergroup manager->User Album Permissions-> Album Photo Maximum Height/Width.
I feel slightly sick
Thanks for solving my problem. It was in the user group settings for admins.
When you said it looked ok to you (looking at it being in the registered group) that got my wheels to turning that it had to be a group permission. One thing I now know I need to do is to create an additional account for myself in the "Registered Usr" category. So I can compare what the membership sees as compared to what I as the Admin see's.