Yes, it works now!

The problem was that every time I made a change to the Template and saved
it, the mergefield which pointed to the picture took the actual value of the
first record so that the field code changed (unseen) from

a) {INCLUDEPICTURE "{MERGEFIELD Photo}"}
to
b) {INCLUDEPICTURE "House1.jpg"}


Solution was to make sure that the field code looked like a) before I saved
the Template.



I just can't get it to print without merging it to a new document then Ctrl
A snd F9-ing before printimng, but hey-ho its Friday the 13th!