After much frustration I was finally able to get this work, so I wanted to share the actual answer here. I can't believe I was not able to find a specific working example anywhere!
Here's what you need (after doing all the basic install stuff first). Note that I added a Yes/No 'Publish' column to my picture library so this only selects the pictures I checked. Of course the list ID in the SPDataSource Parameters much match yours. I kept trying to use 'URL Path' for the image but finally figured out it was 'FileRef' that worked.