I put an image with keywords in alt tags, filename etc, at the top of the home page.

It dropped placings, until I moved the image further down in the content. So I think it has it's place but text is more important.

Yup. Keyword in Alt Tag and File Name. They are important so make sure you take the time to optimize them. Let me put it this way, one image I optimized ended up 2nd in Google images, and pulls up when the keyword is searched. Just from people clicking on that image, I've done over 70+ sales alone off that one image/product on Amazon. Will never skip out on optimizing them as taking that few extra seconds of time is always worth it.

To me it's really important, you can get high volumes of traffic from Google image search. Actually just yesterday I received 100 visits from image searches. Just name the image correctly and not right something random.