Please post your question only once...
Is your Display Performance set to High Quality Display? What does the image look like when you export to PDF?
Sorry about the double posting. There was a lag there, and I didn't know if it had posted on my first try.
I just changed Display Performance from Typical to High Quality. No change in appearance.
I exported to PDF, and the PDF still shows the wrong image.
I have several other images in this document which I have added the drop shadow, then re-linked and the updated image showed up just fine.
Is the correct layer visibility set?
Also, try re-saving the problem image in Photoshop doing a Save As to force a re-write and see if that helps.
Does the image in question have a clipping path in it? - Indesign could be using that to crop it.
I did the Save As. Still not working. I also tried flattening the image in PS and then saving as a different file name to make sure it wasn't a layer issue. And it STILL appears as more closely cropped and without the drop shadow. Bizarre. And as I mentioned earlier, the thumbnail of the image using the Place tool appears with the drop shadow but when you click to drop it into the document it appears with no drop shadow. I'm confused.
Aha! JointyJr is the winner! Thank you so much! Yes, the image had a clipping path, so I went back and deleted the path. Now when I place the image, it is cropped properly and presto! the drop shadow appears! Good work. Still not sure why this only happened with this one image out many that I've placed (as they all seem to have clipping paths), but oh well....