I think it would be better for the "Generate Default Template" link in the Configuration to produce the image tags when dealing with Image type fields. If the site developer, just wanted a path, without the image showing, then a Text type field could be used.
So it would be better to have the code produce something like:
<img src="#IMAGEFIELD#"/>
instead of the current code that is generated for Image type fields.
<BR/>#IMAGEFIELD#<BR/>
Other useful additions to the Image type field would be to have Image Height and Image Width properties for this field type. Then you could set either of those or both to contorl the display. If those had values then the appropriate attribute would get added to the <img> tag when the "Generate Default Template" link is clicked from the Short View configuration.
Of course the site developer can customize the HTML after this, but this makes much more sense than the current implementation of the Image type fields. As it is now, it is more of just a renamed, Text type field.
If these changes were implemented it would make the UL much more versatile and useful when applications require displaying images in the records.
Another nice feature; would be for the displayed image to be linked to the regular sized image. In case you have larger images and are using the ImageHeight and/or ImageWidth attributes proposed above to create "thumbnails" to display in the record.
If the Image type field is modified in this way, then it becaomes even more useful.
I'm not sure if this will help you, but it is possible to use an image field in this way in the template:
(it will show a thumbnail and allow you to click it to display the full image in another browser window)
<a href="#PHOTO#" target=_blank><Img src="#PHOTO#" border=0 height="100" width="100"></a>