Sorry for the double post but thanks to you guys it all worked out. My icons are not disappearing anymore. But now I have a really weird problem. I'll describe it then post a picture for you guys. Initially when I load my theme onto the PSP this is what I get for my icons. Note the position.
Original.gif
After playing around and making other adjustments to other things and not the menu icons, my theme suddenly changes its menu icon position. It moves automatically to the right abit.
Error.gif
Here is the catch though. When I enter a submenu and exit, the main icons then revert back to its original spot like in the first picture. I tried formatting the whole MS and also creating the theme from scratch again with no effect. It keeps on moving itself over on boot and goes back to its original location after entering menus and exiting.