I'm having similar issues. Basically, the photos are not being displayed in an album in the actual way they were sorted. When you are looking at an album of photos, you would naturally think the top-left most photo is going to be the first photo. However, by clicking on it you will find that the photo will appear with both the "previous" and "next" links, revealing that you are indeed NOT at the first photo in the collection.
Hmmm... don't know what I did, but it appears to be working. I enabled thumbnail navigation and re-did the default sort order to "caption" and now it looks to be working fine. Go figure. :) Aside from that small stumble - this is seriously an excellent photo sharing tool for websites. Thank you.