>completed successfully (AFAIK) except for one
>endless/infinite loop on an image (actually a 404 error)

Two reasons:
- the server stpidely replies with a 200 ("OK, page found") 
message instead of a 404 message, as requested by the RFC

- httrack still sees in the fake 404 page the code:

// preload images to be placed in tooltip
// place your images in this array
var imgAr = new Array(
	"images/sm-duck.gif"
);

.. and attempt to fetch again and again the file.

I will try to find a way to avoid this, but the problem is 
not trivial..