using Mark files 'new' less than xx days in the setting Site/Extra works, but only in that folder where the new files are located. In the obselete Turtle skin it was different. New photos are also indicated in thumbnails of parent folders and the top level of the album. Now you don't know where the new photos are, except you use additional possibilties as using the setting sidebar/search new images which is a very nice feature. Congratulations!
Previously I used my own routine to find out if any photo was modified in the subfolders. Now after David's advice I started using jAlbum's built-in deepLastModified function, which supposed to do the same but much quicker. It seems that function doesn't work properly. We will look into it. I could not look into the setting - as no lifeboat.zip was uploaded along with the album -, but perhaps the "Advanced / Process only updated subdirectories" settings has effect on this functionality - you might want to check if that's OFF.
The Search new images was set to find images only in the current folder, you might want to change to either "Whole album" or "Subfolders included".
(I use JAlbumUtilites.getDeepLastAdded in my own skins, and have never had any problems with it. I do my own variation on getDeepLastTaken, for other reasons, and I don't offer a "last modified" option, since I don't think it conveys any useful information.)
I have changed the way skins store the modified date. Previously the skins stored the days since 1970.01.01, but lately I've changed this to second-based. This way you can get better times, e.g. now the "modified in the past 24 hours" is punctual. Probably I forgot to change every line of the code to match this.
That's not really the point, is it? In my demo album, a bunch of the images are marked as "newly added," but the folder that contains them doesn't show any indication that there are new images in that folder.