I have no idea what happened, but my blog title image disappeared. I'm not sure how long it was missing, but perhaps a couple of days. I ended up uploading the image to a website, and then using the URL to reference where the image was located.
I found some recent information from others where their images disappeared, but nothing that seemed identical to my situation. The other mentions of missing images all pointed to Picasa web albums being deleted, and that was why the images were missing. I didn't delete anything recently, so I don't think that was my issue. However, I assumed that when the layout control gives you an option to select an image from your computer that it was copying the image to whatever disk space is used to host your blog entries. Perhaps that was a bad assumption.
Has anyone else experienced the problem of blogger title images disappearing?