I've been having this problem for a while, I have an album in iTunes, and it has the album artwork on display in iTunes. I put the album on my iPhone, but when i tilt sideways and view the albums in cover flow, the albums artwork is missing! Not even the default grey question mark! The name displays at the bottom of the screen with the artist and album name, and just blank above it.
I haven't been able to find any similar story anywhere on the net, nothing at all. I think I have found the cause of the problem. When I'm in iTunes and I select all the songs in the album together, and right click Get Info, the artist and album name are there as expected (because that is common information between these songs), but there is no album artwork! So I'm guessing that at least one of the songs in the album doesn't have the album artwork specified. So when the iPhone wants to display the album artwork, and it sees that not all the songs have the same album artwork specified, it chooses to display nothing. I have no idea if that is the true cause of the problem, but its the best i can come up with.
The Solution
In iTunes, select one of the songs in the ablum, and right click, Get Info. Check that it has the album artwork by selecting the Artwork tab. Right click on the picture (this took a short while the first time, not sure why), and select Copy. Hit OK or Cancel to get out of that. Now select all the songs in the album together, and right click, Get Info. In the bottom right corner where the Artwork display is empty, right click and select Paste. Hit OK.
Sync your iPhone and revel in victory.