Ok...I'm a newbie...where is the desktop image loaded? None of the themes I've downloaded will display a desktop image. All I get is the 'austerity' image. Do I specify a path in step.rc?

...wrong forum. this would go in modules, but i'll help you out because im a nice guy. I assume your pondering how to have desktop icons? You would need to include a module that would do so, for example icondesk http://www.ls-universe.info/download/modules/icondesk-0.68.zip.
open up the theme folder, look for a theme.rc file, and add the line *NetLoadModule icondesk-0.68. afterwards you would just need to properly set it up by reading the docs in that zip file to make the desktop however you want.

Thanks for the reply. However, I don't think I worded my request right. I don't need the icons, I need the background image. All I continue to get is 'litestep'. Where would I load a background image for each theme?
Thanks

Themes generally do not include wallpapers.

You can change your wallpaper yourself, the way you always have, in Display Properties.

some OTS2 themes will install the wallpaper too though, you can disable this with one of the OTS2 installer's Utils, cant remember which one though...