I resolved it sort of, instead of doing the link to /tmp I just created a bunch of links to lowercase .jpg files in the same directory as the originals and it works. Not the perfect answer as it would be nice to know why it balks at links in other directories, but this work around seems to be okay.
This is what I’m using and what works.
x=0; for i in $(ls -r -t *JPG); do counter=$(printf %05d $x); ln -s "$i" "$counter".jpg; x=$(($x+1)); done
ffmpeg -i %05d.jpg -r 30 -s 1440x1080 -acodec libfaac -aq 100 -vcodec libx264 -preset medium -tune animation -profile baseline -level 3.0 -crf 30 -threads 0 -vf "movie=watermarkpng.png [watermark]; [in][watermark] overlay=main_w-overlay_w-10:main_h-overlay_h-10 [out]" outputfilename.mp4
rm *.jpg
Rich