1. If the plugin causes the media library to go blank, it is most likely a plugin conflict. To resolve the issue try disabling all plugins and then turn them on one-by-one to identify the plugin causing the conflict.
2. If you use transparent images please see this support thread.
3. If the plugin does not seem to work, try clearing your browser cache, switch to a different browser, disable browser plugins, or clear the site’s cache if a caching plugin, such as W3 Total Cache or another, is being used.
4. Try switching briefly to another theme such as Twenty-Ten or Twenty-twelve
The plugin provides the most secure method of applying watermark – watermark image is permanent and becomes part of the image. However removing watermark is possible with image regeneration tools like Regenerate Thumbnails or AJAX Thumbnail Rebuild. The only condition is you have to keep original, full sized images intact. as recommended in the plugin.