Hi guys,
Until about 10 minutes ago, I was just as lost and confused as you guys were, and very disappointed that it seemingly is such a chore to do something that should be very easy. I have the quick and easy solution to this problem.
The first key bit of information is this: in Leopard (10.5.2 currently), Photo Booth stores the information of what photos it shows in a file called "Recents.plist" and this file is in 'username'>Library>Application Support>Photo Booth. Now that we know where this file is, we can ignore the one that is actually in the Photo Booth folder (with all your pictures), since that one isn't being used anymore; you can keep it, delete it, eat it...whatever. Now, the tricky but easy to follow part is this:
Open terminal. Type cd, then press the Space Bar. Now in Finder, drag the folder you're working with ("Photo Booth"...should be by default in your Photos folder) into the Terminal window.
Mouse click on Terminal to make it active and hit Return.
Then type ls -1 (that's lower-case l, s, and the number 1, meaning "list short with one entry per line").
Hit Return again. You should get a list of all the files currently in the folder.
You'll have to alter the list a bit (I usually employ Microsoft Word for find and replace work) to translate it into the proper format. Open Word and paste in the data from Terminal. Delete Recents.plist from the end of the list (since the finished plist doesn't need to include itself in the list of photos).
Hit Command-F, then click on the Replace tab. Enter ^p in the search field (that's the code for paragraph breaks) and enter </string>^p^t<string> in the replace field. Click on Replace All.
Add a <string> to the first item in the list, and delete any unneeded extra stuff at the end of the list.
Select the results and hit Command-C to copy.
Switch to the recents.plist file that you've opened in TextEdit, select all the <string> lines, delete, and paste in the new lines from Word.
Save the new recents.plist file to disk and reopen Photo Booth. All the pictures in the folder should now display.
I hope this helps. I did it and it worked really well for me.