Hi,
If you want to have control and embed pictures in the template using Auctiva's tag system, use the [DESCRIPTION] tag instead of using the [DESCRIPTION_AND_IMAGES] or one of the arrangement tags, e.g. [IMGS_VERTICAL]. That gives you full control of where and what IMAGE tag method you want to use in building/converting a template for use.
Not sure about the border problem. Normally, the 400x300 images tags, e.g. [IMAGE1], should add the border. Are you seeing that problem using the one-page lister Preview? If not, test the template with the one-page lister for actual results. If you are using the URL tags, those don't add the borders, but you do have full HTML/CSS functionality to create your own borders (why I like those tags best). With the one-page lister, the URL tags don't require anything special for Auctiva hosted images, just select the images as normal off the pop-up menu.
Hope that helps.
Danno