There’s still an issue in that there’s an obscure incompatibility with the <a href="http://wordpress.org/extend/plugins/picasa-images-express/">Picassa Image Express plugin</a> that didn’t exist previously.
I’m going through all possible settings combinations, but I can’t for the life of me figure out what settings to use when picking images through PIE.
When images are either self-hosted, or Picasa Web used without activating PIE it works fine.
It’s really strange, because I used to have Slimbox2 and PIE together, without a hitch; that allowed using self-hosted images (i.e. just using Slimbox2) or Picasa Web with PIE (it makes selection / insertion of Picasa Web hosted images [b:2mjj6m5v]much[/b:2mjj6m5v] easier!) seamlessly.
Frankly, I never used Slimbox2 with the "manual" tagging option for Picasa Web integration because that’s just too much of a hassle.