I have site which had fairly good rankings on google, but since i update lot of pages with affiliate images (image is on the affiliate server) but the text content is original. Since the update google has put some of these pages at the end of their results for the keywords.. I am guessing some kind of penaly on these pages but only thing i can see as a problem is the images and a search box for the affiliate products, rest are my own unique content....
Does google give penaly for using affiliate product images or using the affiliate search functions?
I also have links directly to the affiliate site on some other pages which are not indexed by google, will this linking effect the ranking as well?
No, the mere presence of affiliate links or images is not an automatic penalty.
However, Google is looking for something beyond just non-duplicate content. They are looking for substantial added value. Google spokespeople have said they want to see a great site with some affiliate links, rather than a site that exists just to push affiliate product, the same producats as many other affiliates are also promoting. Content quality is their first consideration.
This is one of those areas where human editorial input [webmasterworld.com], reviewing all the SERPs for monetized keywords, comes into play.