I've tried to clear all caches many times. the src attribute is empty: src= width="" and so on. I don't think that image magick is the problem because I can upload images, embed them in articles and preview them fine in the administration interface. I can also view the images by direct url as a user. I just cannot embed them. If I do link href='ezobject://281' it links up and the image shows. But embedding does NOT work :(
In frustration I created an override for the embed/ezimage.tpl to try to see for myself what happened. This is what I did:
Try with image.tpl template from design/base/override/templates/embed. Make sure that correct override rule exists in your override.ini.append.php file for public siteaccess.
That worked when I put {attribute_view_gui attribute=$object.data_map.image} I have no idea what happened here seing as it did work before... But now it works again, and I'm happy :) Thanks!