Solution!
Wife was having the same problem -- only 20 or so photos, but Manage Storage said she had 2.3GB worth of photos. We tried everything other than erasing the contents of the phone. We severed all iCloud connections involving photos, removed all the photos from iPhoto and backed them up to a different folder, and deleted all photos off the phone. Nothing Changed!!!!
Until my wife started browsing through Messages. She noticed there were a lot of photos and videos hanging out from me and her family, so she started deleting photos and videos from specific messages. Lo and behold that did the trick! Her photo count and video count went down and her amount of space available increased! She had to delete them one by one, BUT IT WORKED!
Only thing weird thing is that she didn't make it very far into the deleting process, and her Used Space dropped drastically from 2.3GB to the 300MB range.
So I don't know if this is a glitch, or if she just deleted more than she thought, but my wife is totally happy, and you all know what that means!
Hope this helps! We were so frustrated by this issue that we just had to write on here what worked for us in hopes that if would give you all a bit luck!