The update check is telling you the truth about the wrong thing. 11.02 shipped on 6/13/2024 and that is where the DeskScapes 11 line ends, so 11 will keep reporting itself current forever. The shipping version now is DeskScapes 2026 (26.0.1.1, released 7/27/2026), and being a major release rather than an update, it does not come down through the updater in 11.
Whether it costs you anything depends on how you bought it. Active Object Desktop clients "will receive new releases at no extra charge". A standalone lifetime licence covers minor updates for the version you bought, so 11 to 2026 would be a paid major upgrade, with any upgrade discount shown on the DeskScapes product page. Order History under store.stardock.com/myaccount will tell you which of those you have.
I am pointing at versions rather than at a setting for a reason. The only Windows accommodation listed in the 11.02 changelog is "Updated DSHost.exe to better account for Windows 24H2". If your machine has taken a Windows feature update in the last few weeks, that gap is the first thing I would look at, and there is no later 11 build that closes it.
On the static pictures coming up blank, there is a check worth running either way. Select one of the blank ones in DeskScapes and read the file path listed to the right of the thumbnail. If those paths point somewhere the files no longer live (a folder you moved, a cleared downloads folder, OneDrive relocating a folder under you), that explains why your older picks are empty while anything you added recently still shows.
If you do move to 2026, do not install it over the top. Neil Banfield's instruction for a machine that ran DeskScapes 11 first is to uninstall, reboot, and then install 2026, since otherwise you can be left with mismatched files from the two versions. The reboot is the step people skip.
If you would rather stay on 11 for now, the DeskScapes purge tool is at https://cdn.stardock.us/support/uploads/DSPurgeNew.zip
Run it as administrator, which on Windows 11 means picking "Show more options" in the right-click menu first, then reboot and reinstall from your account page.