[EDIT]
Forgot to mark this as DBP 7.5
Whenever you call "LOAD IMAGE", all changes made by "SET SPRITE TEXTURE COORD" are lost.
Here's a sample, uncomment the load image command after running it once to see what it should look like. (I've attached background1.png)
load image "background1.png", 1
sprite 1, 0, 0, 1
set sprite texture coord 1, 1, 2, 0
`load image "background1.png", 2
do
loop
This is what seems to be causing it:
-At the end of Load(...) in CImageC.cpp, is a call to UpdateAllSprites() in CSpritesC.cpp
if ( iID>0 ) g_Update_All_Sprites();
-Inside UpdateAllSprites, SetVertexTextureDataForSprite() is called for every sprite, which removes any changes done by "SET SPRITE TEXTURE COORD"