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I just installed the plugin. It seems to hang on "Publishing to Posterous" with Live Writer 2011 and eventually crashes.
Windows Live Writer has encountered a problem: The 'img' start tag on line 29 does not match the end tag of 'a'. Line 29, position 145.
If I switch to Souce view, then publish, I get this:
System.IO.IOException: Cannot create a file when that file already exists.
at System.IO.__Error.WinIOError(Int32 errorCode, String maybeFullPath)
at System.IO.File.Move(String sourceFileName, String destFileName)
at WindowsLive.Writer.PostEditor.PostEditorFile.ManagePostFilePath(Boolean isPage, String postTitle)
at WindowsLive.Writer.PostEditor.PostEditorFile.SaveBlogPost(IBlogPostEditingContext editingContext)
Disabling the file uploader plugin seems to get rid of the second error.