Desktop Collage was just updated as well...here's the bug list (crossposted from the dream thread)... 
I have downloaded a new version, even though it doesn't work correctly. 
However, I've tried some things and have found an issue. I believe it's why you keep getting the same images over and over. Once you select one directory, the program does recurse that one down, but it appears as though you can't always CHANGE that directory (see below for two fixes). You can browse through the directories, etc. but whatever you select, the directory you first selected remains the same.
Obviously, this is a bug, but, at least I have found TWO workarounds. Poking around, I found the registry entry for the dream directory. 
1) THE HARD WAY
Using regedit.exe from the RUN command (WARNING!!! don't do this if you aren't VERY familiar with regedit)
HKEY_CURRENT_USER\Software\Stardock\Deskscapes\DesktopPhotos
The directory name is in plain English and stored in a key called PhotoDirectory. Double click on it and you'll be able to edit it easily enough.
Make sure you have another dream playing, or none at all. That way, once you edit this directory, you can go back and select the Desktop Collage dream and whoilla!
2) THE EASY WAY
I also just found another easier way. If you select a photo directory on another DRIVE, apparently the program will update to the new directory proper. Then you can try again and go back to the original drive, of course. Very weird behavior.
These both worked for me.
PS The "randomizer" doesn't work in this version. If you use the same directory you did before, the first drawing has a few random images, but from that point on they all play in the exact same order AND position they will always play in. So the first blush might be cool, but in a minute or two, you're right back to the same old same old. This would indicate that the programmer's random SEED is the same every time the program is run and never changes. In the old days, I would recommend that said programmer generate a true random SEED (perhaps using the TIME as a source value). 8P
