What you see when you look in the library are only Thumbnails of the actual picture.
Double clicking the thumbnail should display the original, full size, picture. If iPhoto looses track of the original, you get this error.
When you copied the photo's from the external drive, where did you put them?
Theoretically, they are still in the folder that you put them into when you copied the.
Put the enclosing folder into the Pictures folder.
Next time you get this error, and iPhoto asks if you want to find it yourself, say yes and navigate to the pictures folder and locate it.
Neither JPEG or JPG are a problem for the Mac.
I'm a new MacBook Pro user. Mac OS X version 10.6.3 using i-Photo 8.1.2 (424). I copied all of my photos via an external hard drive onto the macbook hard drive, then imported them into iPhoto. I had everything neatly organized into files that were easy to find on my pc....now my photos are all over the place. I can deal with that, I think, but now on many of my photos, when I try to open them, it shows an exclamation point on a grey screen. Says it can't find the photo and to connect to the server(??). It has just shown me the picture, but then can't find it? A friend said that sometimes there is an issue with jpg and JPG....the Mac doesn't read one of them. Well....I have hundreds of photos and need to be able to use them and work with them on the Apple. Is there some way to convert them? Something free, preferrably... Also, when I import from my camera into iPhoto I can't find the files on the Apple hard drive...is that possible?