Ooh, don't worry. I've suddenly somehow had a breakthrough.
If anyone else is having a similar problem, (I think) this is how I resolved it.
(Also, my problem was that I had created a header with words on it, and I didn't want the default text to show. I clicked 'hide text' and it would disappear, but somehow I think it was stuffing up my image and making it disappear too. Don't ask me how :S Trial and error seems to prove me right though.)
*I completely restarted so the image and colours went back to the default settings.
*Then I uploaded an image that had just a picture and no words
*It seemed to go in fine and I was completely surprised. This was the first time it had appeared properly for me. Usually it would say image updated and then disappear :/
*I had decided that it was the text which was stuffing my image up, because when the text was hidden my image was hidden, but if the text was there the image appeared. Weird, but whatever.
*I think the order in which you 'hide text' and 'upload image' is important here. It seems temperamental or something. So I hid the text first and saved it. The image didn't disappear.
*Then I uploaded my proper image, the one with words and crossed my fingers. This time it didn't disappear. Woohoo.
Sorry if that confusing resolution doesn't make sense to anyone. Trust me, I'm confused too :/
Therefore the moral of the story is, computers suck and change their minds just to spite you. I don't know exactly why it's working now and not before, but I think it's because my computer wants me to look stupid. If anyone could shed some light on the subject I would be very grateful.