For the benefit of anyone that the info might help :
The issue with getting the image gallery tab in K2 to display images both in the preview area of the K2 admin tab, and online, was resolved ( surprisingly ) by tidying up all the file types of the images ie no inappropriate symbols like hyphens, spaces, numbers or capitals the file type text - to be sure, just in case, I made all the image file names one word, not even any underscores, as well.
I then deleted any previous image uploads in the image gallery tab feature, and re - uploaded the the new images freshly re-zip archived, and all was good. I also had full yse of all the display engine options in SIG Pro ( mootools / jquery etc - they all worked ).
I must also add that I have both the standard and pro versions of SIG installed, and some others have advised this as a possible solution to getting SIG pro to work in K2. I will test SIG Pro without the standard version also being installed over the next few days however, just to see.
But many thanks to Yiota for the help. I'm going to post this at K2 forums as well, as I know many are having trouble with SIG and K2.