Hello..
 
My friendly URLs work when I use the form www.mysite.com/friendly-url but when I attempt to use them with a directory type struture - ex. www.mysite.com/shoes/friendly-url - I just get a blank page when clicking on a sub-category. Any ideas?

Yes, you are right Dani. It does not work with a directory type structure. I think friendly url feature must be improved by the development team.

I see.. the reason I want the directory url structure is that it's supposedly more SEO friendly to the Google crawler.
 
Now when I manually enter a link like www.mysite.com/shoes/casual into a browser , the product listing comes up but the images don't show, only the alt title for the image. I'm thinking this has something to do with the relative image path set in the product list template, but why would the image path matter when the URL is being dynamically generated? Guess I just don't fully understand how friendly URLs work.
 
I Google'd but I haven't had much success fiddling with the mod_rewrite part of the .htaccess file. Maybe somebody with more experience in this can weigh in...