I’ve currently got exactly the same issue Jonathan Wold describes in his last message above. I’m using Version 1.2. of the Ultimate Taxonomy Manager, version 3.2.1 of WordPress, all other plug-ins disabled and the 2011 theme activated.
Logged in as a test editor user, all is fine. But on the original admin log-in, after clicking on ‘Add photo’, and then clicking on Insert into Post on the media thickbox, nothing happens and the image doesn’t show up. I’ve tried switching between the two users in both Chrome and Firefox and clearing caches, and the behaviour is consistent.