No one here knows this WAMP software?   I found its not a Nextgen issue as i tested other gallery and sliders and it has to do directly with jpg thumbnail editing only - gif, png thumbnail editing works fine within the wamp  - so it must be that some service needs to be turned on in the wamp - when i test live on my live vps - editing jpg thumbnails just work without errors. Its only when i do it locally with the wamp that it does not work.   This is the code in the area  
case 'JPG':
			if($name != '') {
			   @ImageJpeg($this->newImage,$name,$quality) or $this->error = true;
			}
			else {
			   header('Content-type: image/jpeg');
			   ImageJpeg($this->newImage,'',$quality);