Very strange. I don't have Graemlins disabled by default and I have enabled images in vars_display.cgi (they were not on by default). Yet still the gramlins will not show up in the signature. They work in the posts, but in the sig. they are not "converted" but simply left as the text used to create them...
Any ideas on places to start looking? Perhaps a mod or something I have installed has mucked with this ability.
Thanks,
-Justin