Chiming in here because I'm having the same issue. The problem I'm having with the solution you propose to the orientation issue ("Just make sure you have your phone right side up when you are taking landscape photos" or manually fixing each one that is having the problem with an edit)
This is an unrealistic solution depending on the scope. I have hundreds of photos that I wish to have in the background image rotation, possibly more than a thousand. For me to invest the dozens of hours it would take to go back and make manual edits to what will likely be 200 or 300 of those images is too much to ask of the customer, as opposed to Stardock making some sort of fix to the software's ability to read the orientation correctly — how it appears on my computer desktop. And this particular feature is the primary reason I made the Deskscape purchase, so it makes the software essentially worth very little if the only solution for using that feature is to add several hours of labor on my part to make my photos work for this one piece of software when every other piece of software I use has no problem getting the orientation correctly. See what I'm saying?
Also, I question the proposed diagnosis, that it's caused by the camera being held upside down. While there are times I have had to do that because of the unique situation, that amounts to likely less than 10 of the thousands of photos I have taken, and yet this issue arises on what I would estimate to be 20% of all the photos that I put into the background photo slideshow
