You may want to capture it in a debug log (step 4b) and send to support for developer analysis: http://www.mediamonkey.com/forum/viewtopic.php?f=1&t=69

Probably a combination. Music ripped from cd's will have a scanned image in the album folder that I then apply to all tracks in that album. Some downloaded stuff probably gets images automatically. Not sure about being embedded, in Options, Library, Artwork it says "save image to tag (if possible) otherwise save to file folder.
It's a new-ish problem although I couldn't say exactly when it started, eg after a version update or something else.
All music is mp3 at 320 bitrate.

I'm unable to reproduce, it works fine on song change here. Is the Artwork embedded, saved as external file or auto-downloaded by MediaMonkey? What file type(s) are affected?

Yep sure is.

And Art & Details window is set to the Now Playing tab, not the Selected tab?

Woops, sorry. Version 4.1.5.1719, Windows 8.1.

Which version of MediaMonkey are you on?

The box below my current playlist where album art for "now playing" should display is blank, (black). When I pause the song, the album art displays but when the current song ends and it goes to the next song it is blank again until I pause the playback again. So to see the album art for each track I would have to pause and unpause each and every song.

Would a full uninstall and reinstall fix this?
Cheers