[pkscout]

1) What happened to the excellent "Display progress images during first download" option the addon once had? Can't find it anywhere in 1.5.4 and it just shows a black background now when downloading artwork.

It's still there and in the same place. In the add-on settings go to ADVANCED. There is an option for DOWNLOAD NOTIFICATION TYPE that should be set to CUSTOM IMAGES, then you will need to provide the path to the folder of custom images (the folder can contain just one image if you'd like). None of that code has been changed, so if you're having an issue and the settings look right, I'd need to see a debug log.

2) How come that when I select "Use both local and remote artwork", it always waits for at least one image to be downloaded before displaying anything? Hence, it shows the black background, even which local fanart the right place (Music\Artist\extrafanart).

Technically it's not waiting for the first image download to show anything, but because of some other changes that is the functional effect. Let me see if I can explain. With 1.5.4 the add-on now looks up the MusicBrainz ID for an artist so that it can get information from theaudiodb and fanart.tv. It does that before attempting to show any images. So the first time you view an artist in 1.5.4 there may be a delay before the images are shown depending on how hard it is to find the artist in Musicbrainz. After that, AS caches the MusicBrainz ID (or an empty string) locally, so you won't see that delay anymore.

I'll look to see if there is an easy way to restructure the logic to show local images if they are available, but I think the way I have things setup it would require a substantial rewrite.