Why are my images now being masked and how do I get rid of the mask?

Now that I have converted to the new but not improved version of Express and tediously converted my files (I had nothing else to do on a Saturday afternoon, I guess) I can't edit the images. When I replace an image it comes in with a dashed line that masks the image. This was not there before and I can't figure out how to get rid of it. All of the online tutorials and help are for the old version, so that's helpful. At this point, this is totally unusable. Has anyone figured this out? 

* Also, the choices for the topics at the bottom of this are almost funny. It shows how disconnected the Adobe team is from this abomination of an app.