when you referance the button class you mean button.tpl?
I tried coding inserting an image tag but I got a smarty error unrecognized syntax.
Here was the original code I used and I'll past what I insertend into the menu tpl file.
Original menu.tpl file
<TABLE border="0" cellpadding="0" cellspacing="0" width="100%">
<TR>
<TD class="VertMenuBorder">
<TABLE border="0" cellpadding="1" cellspacing="1" width="100%">
<TR>
<TD class="VertMenuTitle">{$link_begin}[img]{$ImagesDir}/{if $dingbats ne ''}{$dingbats}{else}spacer.gif{/if}[/img]{$link_end}
{if $link_href}
<FONT class="VertMenuTitle">{$menu_title}</FONT>
{else}
<FONT class="VertMenuBoxNewsTitle">{$menu_title}</FONT>
{/if}
</TD>
</TR>
<TR>
<TD class="VertMenuBox">
<TABLE border="0" cellpadding="5" cellspacing="0" width="100%" >
<TR>
<TD>{$menu_content}
</TD></TR>
</TABLE>
</TD></TR>
</TABLE>
</TD></TR>
</TABLE>
My modication is located at the bottom
<TABLE border="0" cellpadding="0" cellspacing="0" width="100%">
<TR>
<TD class="VertMenuBorder">
<TABLE border="0" cellpadding="1" cellspacing="1" width="100%">
<TR>
<TD class="VertMenuTitle">{$link_begin}[img]{$ImagesDir}/{if $dingbats ne ''}{$dingbats}{else}spacer.gif{/if}[/img]{$link_end}
{if $link_href}
<FONT class="VertMenuTitle">{$menu_title}</FONT>
{else}
<FONT class="VertMenuBoxNewsTitle">{$menu_title}</FONT>
{/if}
</TD>
</TR>
<TR>
<TD class="VertMenuBox">
<TABLE border="0" cellpadding="5" cellspacing="0" width="100%" >
<{$img_type} src="{$ImagesDir}/files/images/loginbglarge.gif">
<TR>
<TD>{$menu_content=}[img]{$ImagesDir}/files/images/loginbglarge.gif[/img]</TD></TR>
</TABLE>
</TD></TR>
</TABLE>
</TD></TR>
</TABLE>