KindleGen gave the same result as calibre's conversion from ePUb.
But when I edited the calibre-produced HTML to remove the (superfluous?) paragraph tags around the list items, I finally got a good mobi file! It converts correctly whether converted by calibre or KindleGen.
For example, I changed this:
Code:
<ol class="calibre3">
<li class="calibre4">
<p class="calibre5">This is item 1</p>
</li>
<li class="calibre4">
<p class="calibre5">This is item 2</p>
</li>
</ol>
to this:
Code:
<ol class="calibre3">
<li class="calibre4">This is item 1</li>
<li class="calibre4">This is item 2</li>
</ol>
...and everything worked well. It looks like the paragraph tags on list items is what's messing things up in this case.
I'll whip up a RegEx in BBEdit to batch-process my files until this gets taken care of. Now maybe
this is a bug worth filing!
(off-topic zone follows)
Interesting about Imageshack not displaying for you. Actually I don't have an account or anything, I just go to the site, upload the image, and copy the URL it gives me. Theoretically I could sign up in order to have a list of the images I've uploaded, but I don't bother with that.
Maybe it's an IP address thing? It'd be over the top to do just to check this, but trying something that changes your IP like Hotspot Shield might give different results.