We need to have a place in admin to set a default image. And if that image is not found via the newsfeed then the default image will be used.
What happens is that if someone uploads a photo, then removes it, we get the blank box with the x in the newsfeed. What i have been doing is going into the userfiles and uploading a default image with the same name so atleast it will show something.
This can easily be done by traping the error, checking fileopen to be sure it does not exist, then renaming the def image to that name.