Banshee sends its album art via the "icon_data" hint ("image_data" in http://www.galago-project.org/specs/notification/0.9/x344.html). When this artwork is not square, i.e. its height != width, the image is not displayed. This can be seen in the log found here: http://orangesquash.org.uk/~laney/dbus.log which is an example of one such notification which had its image ignored by Notify OSD.
In contrast, this does not happen for non-square icons sent via the "app_icon" argument, as mentioned here (http://www.galago-project.org/specs/notification/0.9/x408.html#command-notify). An example of dbus-monitor's output where this is concerned is as follows. Note that this means that notify-send *cannot* be used for attempting to reproduce this bug:
method call sender=:1.642 -> dest=org.freedesktop.Notifications serial=6 path=/org/freedesktop/Notifications; interface=org.freedesktop.Notifications; member=Notify
string "notify-send"
uint32 0
string "/home/hyperair/Pictures/compiling.png"
string "blah"
string "blah"
array [
]
array [
dict entry(
string "urgency"
)
dict entry(
string "category"
variant string ""
)
]
int32 -1
Branch with fix for the impatient can be found here lp:~macslow/notify-osd/fix-443979