Display image of last 2 posts on home page

Do any know of good plug-ins that can do the following: I basically want to show the title and the image from the last two posts of a specific catagory on the home page with the image used in the post resized and perhaps the option of some of the text (first paragraph) with a “more” link. At the moment I have a query-post that is only showing text. I have also tried

<?php query_posts('showposts=2&cat=1'); ?>
<?php while (have_posts()) : the_post(); ?>
<div class="thumbnails"><a href="<?php the_permalink() ?>" rel="bookmark" title="Permanent Link to <?php the_title(); ?>">
<img src="<?php echo get_option('home'); ?>/wp-content/
<?php $values = get_post_custom_values("Image"); echo $values[0]; ?>” alt=”" /></a>
<p class=”title”><a href=”<?php the_permalink() ?>” rel=”bookmark”>
<?php the_title(); ?></a></p></div>
<?php endwhile; ?>

The image don’t want to show. I have looked at the source code of the published page and tested the path in the browser. The path is fine and the image show. But its a no show in the actual page.
Please help!!