yes you should change this
<tr>
<td>
<{$img_type} src="{$ImagesDir}/but1newbutton.gif" class="
atcSide" alt="{$title|escape}" />
</td>
<td class="
atcButton"{$reading_direction_tag}>
<font class="
atcButton">{$button_title}</font>
</td>
<td>
<img src="{$ImagesDir}/but2newbutton.gif" class="
atcSide" alt="{$title|escape}" />
</td>
</tr>
to this
<tr>
<td class="
atcButton"{$reading_direction_tag}>
<div><img src="{$ImagesDir}/mybuttonimage.gif" alt= add to cart" />
</td>
</tr>