The solution is to put the image inside your webroot and request it via http. Firefox will not open a local file requested from a remote site for security reasons (Even though apache is running at localhost, firefox considers it "remote").

Details are here: http://kb.mozillazine.org/Firefox_:_Issues_:_Links_to_Local_Pages_Don't_Work, along with their reasoning. There is also a workaround, if you still feel you need it.