In version k2 2.6.0 (i'm not sure about earlier ones) and joomla 2.5.7 jquery is always loaded from remote location, regardless of the parameter value chosen at the k2 cpanel.
In order to correct this change the following
/administrator/components/com_k2/helpers/html.php line 73
$handling = $application->isAdmin() ? $params->get('backendJQueryHandling', 'remote') : $params->get('JQueryHandling', '1.8remote');
should be
$handling = $application->isAdmin() ? $params->get('backendJQueryHandling', 'remote') : $params->get('jQueryHandling', '1.8remote');
in other words the parameter name "JQueryHandling" must be "jQueryHandling".
