Image Transform path issue
The file system path has to be an absolute path from the root of your filesystem, like /Users/myuser/webserver/myproject/public/assets/images. 

For portability between different environments, it's a good idea to make an environment variable that holds the path to your project, which you can then use in the assets file system path. This is described very nicely in the "Environment-Specific Variables" section of the "Multi-Environment Config" part of the docs.