I can access the queue through that URL but no images, just posts. How come there is no link to this URL in the admin area for posts or images, not sure why both content types would be in the same queue.
The permissions seem to be okay as well but still i do not see the unapproved images in the image categories.
I don't think this is something we've managed to reproduce. It's probably easiest if you can submit a ticket with FTP details and access to an account that should be able to see unapproved images. It may also allow us to reproduce the watermarking timeout issue.