The WordPress upgrade to 2.1.1 fixed the Live Writer problem!  Excellent

I spoke too soon.  The postings work,  the RSSproblems solved,  but the image uploads still have problems.  It seems like images are constantly causing problems,  and the image that gets uploaded (even though an error happens,  and the post does not go up,  the image still seems to be getting uploaded to some crazy long image name to the tune of :

windowslivewriterPostTitle-f98img-0993.jpg  and its thumbnail,
windowslivewriterPostTitle-f98img-0993.thumbnail.jpg

(Update:  the last upload I tried stoppped with the following error: “Image Upload Not Supported By Weblog”  the following images canot be published becuase the weblog does not support image publishing:  and it shows imagename.jpg  and imagename_thumb.jpg.  Something has happened at the WordPress end or the Live Writer end,  because this works intermittently.  And the post does NOT go up. Drat!)

Source: WordPress 2.1.1 update fixes Live Writer Image uploads at Theoblogical