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Well, after lots of trial and error we have finally found a solution for the captcha image not being displayed in XOOPS versions earlier than XOOPS 2.3.0. We installed Frameworks on our 2.0.18.2 test site and the captcha image now appears as it should. For users with XOOPS 2.3.x you will have the option of using the core captcha or the frameworks captcha. In the xoops_version.php file we perform comparisons for whether or not frameworks is installed to decide which captcha enable options to display in module Preferences.
We should be wrapping up the testing and have ShoutBox v4.03 ready for release within the next couple of days. We will be posting in the news here when it is available for download.