Paul_o_b - 10:34 pm on May 8, 2012 (gmt 0)
Backtracking: If the anchor text isn't visible, why is it there at all?
I agree that if images are deemed as content then they should be in the html but if they are decoration only then they should be in the background.
However when you have rollovers for a navigation it is often easier to use css background images instead as the rollover effects are easier to manage and easier to change at later dates while also keeping the mark up a lot lighter.
It's cases like these that are suitable for image/text replacement techniques but you must use one such as I described above that works in any scenario of images/css on or off.
If you feel you must use images then you can actually do rollovers on an image by setting the image dimensions to zero and use padding for the width and height and then show a background image on the image itself. Anything is possible with css ;)(nearly)
In the end it all boils down to the job in hand and whatever is easiest and most efficient in the circumstance.
However you should not be penalised for doing something correctly otherwise we'd never be able to use overflow, height,width,display, clip, absolute position and so on as they will all hide elements when required.