I've also had problems setting the thumbnail. What seems to work is to do it as the absolute last thing before submitting the article. Under Article Thumbnail on the right, click on Browse... and navigate to the file (which you also uploaded previously). Select the thumbnail and then submit the article. Hope this works for you.
I'm updating one of my old articles using the Article Submission Wizard. I've uploaded new downloads and updated the links in the article. But when I go to preview mode and test the downloads, for all of them I get "No download file was specified".
I've looked at the HTML source in the editor, and it does look reasonable.
All three forms of img tags works for me when I view my standalone article.html on web browser. It is only when I copied and pasted the article onto the online editor that it starts to auto format my html that the images do not shown up after submission.