Howdy Paul!
I can’t test this at the moment, but most of my weird problems with E3D come down to scale. I’m not sure if this applies to your particular issue, but I always add a null that I link every 3D component to (element group nulls, lights, camera, etc.), then scale it so it fits within the “world” – meaning your top and front views. If your scene is really small, you might need to scale it up, and if it’s too big (probably not the case here, but it will definitely affect AO and shadows) you need to scale it down.
Now, the other thing is your screenshot is from the E3D GUI, and there’s a switch there for “use draft textures” – is that on or off? Also, what size if your texture map? The preferences setting is for the max size of the texture maps (I believe) and doesn’t actually have an effect on the size of your texture map itself.