I converted mine using PDFtoepub from
http://www.pdftoepub.com and it kept the pictures, and there are no spaces between the paragraphs. It really didn't turn out too bad.
@ Charlotte: Here's the link to the author's website: [link deleted] You can get all 3 books in pdf format only. I've read the first one, and while it's not Rowling, it's quite good. It's fanfic about Harry & Ginny's son at Hogwarts.