1) Either the file you opened was not a recognized format, or you need to give DropImage more RAM to open that file. DropImage loads the image into memory for fast dynamic resizing, so large images require a lot of RAM.
2) If you are using Quicktime 2.5, the number of formats supported are extremely limited. Consider upgrading to Quicktime 3 or later
3) If you are using Quicktime 4, make sure that you installed the "Quicktime Still Image" support option. This is can be added to your system via the custom install option of Quicktime 4 if you did not do the full install. The full install of Quicktime 4 is recommended for maximum format compatibility. Several people who had problems reported that this worked for them.
Miscellaneous
4) You may be wanting to write out GIF files. Unfortunately, a licensing issue with UNISYS prevents me from being able to export GIF images without paying a sizable licensing fee to UNISYS. For this reason, PNG and JPEG are available as web-friendly output formats.