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linuxway:
This depends on what you call "the image tag of an article". If you mean the
topic icon, the one that has a link to the topic index, it's defined within the class newsstory. Look for the file
modules/news/class/class.newsstory.php and there look for the function
imglink(). I can't give you the lines because I use News 1.2 and you might have News 1.1, but it's around lines 237-244. By default, this function has a 10px space both in the horizontal and the vertical sides.
If you mean the images placed within an article/story, then we're talking of a different subject. For that you'd have to trace the workings of the image manager, assuming you use the image manager to place your images. Personally, I put the code by hand, using floated layers to place images wherever I want. If I want an image in the right side, for instance, I use something like:
This gives me more control about where I place things.
Cheers.