When the list of posts with attachments is being processed, those that cannot be converted are left in the list after each pass rather than having some kind of exclusion mechanism. If the attachment cannot be converted on the first pass, it is not likely to be converted on subsequent passes. Eventually those unconvertable images will fill the list. The starting post ID can be changed to exclude them, but it would be better if they could be held in a temporary table to be excluded from the next set of posts with IMG bbCodes in them.
Once we got our board more or less under control we stopped using Convert Image All but it is still installed.
If you do not specify a starting post ID and a limit on conversions using the options in AdminCp, I don't think you can make it work on a really large board with lots of foreign images. If you do use the starting post and limit options, it is fairly easy, but will take a bit of time to do the job. It took me about a week on our board. (over a year ago)