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Followed README, images placed at /usr/share/lxlauncher/backround does not work.
It used to work in earlier version. Not sure it's lack of update on the README file or a bug.
Correct category to lxlauncher
I looked into lxlauncher's source code, and noticed that the code used to load image files with gdk_pixbuf_new_from_file() is commented. Maybe bacause we will add theme support?
I believe this issue is completely fixed in latest released version, that should work now, just directory is not /usr/share/lxlauncher/backround but /usr/share/lxlauncher/background instead. Thank you very much.