not2easy - 8:39 pm on Jul 13, 2011 (gmt 0)
If you have not managed to take care of this yet, the vertical space under images can be a result of using the media library in WP and its interface. In the html editor for your page, look for the image code:
<img etc follow it along to where you find
caption="" and remove that. It adds a frame with a vertical space under images if it is left blank.