I discovered the issue causing this:
Duplicate uploaded images on my test server ( I was using the same image ) was causing an error.
The output img src was:
<img src="/media/img/600X160_1.png">
When I removed the "_1" from this, it solved the problem:
<img src="/media/img/600X160.png">
By preventing duplicate file names (I added the upload time to the end of the image) I solved this peculiar issue.