Path to banner images incorrect

I have the ad module installed with no other "image" modules other that TinyMCE/IMCE.

I had 5.x-1.5 installed and had the problem and just upgraded to 5.x-1.6 and still have the same isuue.

Everything installed fine and I have been able to confiurge and create my ads without any trouble. However the ads are not displayed. Looking in http://www.mysites./sites/all/modules/ad/serve.php?q=1&t=2 I can see that the path to the image is http://www.mysite.com/sites/all/modules/ad/files/myimage.gif and it should be http://www.mysite.com/files/myimage.gif.

I have configured the path in adserve.inc per the install.txt file but that didn't help.

Thanks