I hadn't had time to do much research on this because my head's been in other projects, but after some tests this morning it really looks like there is a bug with adding new artwork to tracks in iTunes 10.4 running under Lion. Perhaps this is old news for some. I've been getting various email reports of this, but no one ever has the same story, which makes it difficult to piece things together. The problem seems to be: while new artwork will display in iTunes, it does not travel with the file (eg, when copying to another Home Shared iTunes) nor does the Finder icon of the track's file display the artwork. Seems like the image data isn't being written to the file. Doesn't seem to be a problem with iTunes 10.4 in Snow Leopard, though. There's no homemade fix that I am aware of so we'll have to wait to see if Apple does something about it.