Have you tried deleting all the cache first?
lol Yes. I direct you to the troubleshooting page
http://forums.qhimm.com/index.php?topic=12848.0*UPDATE*
lolz spotted it--> *GLITCH: broken LGP file (magic), don't use LGP Tools!*It's really interesting to read the APP.log because it shows the path that reads png files from Bootleg mod path (like in your setup)
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/MAGIC/THUNDER/THUNDE00_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/MAGIC/THUNDER/THUNDE01_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/MAGIC/THUNDER/SONIC_1_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/MAGIC/THUNDER/THUNDE01_02.png, falling back to palette 0
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/MAGIC/THUNDER/THUNDE01_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/SPECIAL/HADO/ELEC1_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/SPECIAL/HADO/MOTO1_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/SPECIAL/HADO/DOMU1_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/SPECIAL/HADO/ENERGY00_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/SPECIAL/HADO/ENERGY02_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/SPECIAL/HADO/ENERGY02_06.png, falling back to palette 0
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/SPECIAL/HADO/ENERGY02_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/SPECIAL/HADO/ENERGY00_03.png, falling back to palette 0
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/FF7/DATA/BATTLE/SPECIAL/HADO/ENERGY00_00.png, failed
I'm thrilled !!! everything works like a clock now!!! I made a new APP.log just for test. Only this occurred (I don't know if it's important!)
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/Brizad_00.png, failed
INFO: tried to load C:\Program Files (x86)\Square Soft, Inc.\Final Fantasy VII\/mods/Bootleg/magic/HVSHOT_01.png, falling back to palette 0
I spotted the HVSHOT_00.png and HVSHOT_01.png in my textures folder \Final Fantasy VII\textures\Limit , it might be from Avalanche I noticed it's the same file, so copied/renamed the HVSHOT_00.png into HVSHOT_01.png from your folder?
Thank you so much Grimmy!!!