I kinda have the same issue. I migrated from a test server to my xp box. The portal on the test server is setup as Default Web Site (not virtual, ie http://localhost) in IIS. I migrated this portal to my local XP box for testing "things" and set it up as a virtual directory. Sooo...the relative paths are off because the links to my images have a slightly different path with the virual directory not in the path. So in order for all my images to appear I have to visit each image path and place the virtual directory name into the path. Sooo... i decided that inorder to keep working and to go forward I would just not use the  virtual directory and set the portal on my xp box as the Default Web Site. This is not what I wanted to do for I would like to experiment with the site using virtual directories. Does this make any sense? I guess my question is.... "Is there a better ay of doing this?".