Suppose I'm checking out a org file in a server server1,
(find-file "/ssh:server1:/path/to/org-file.org")
and the org file has a link to an image
file:myimage.png
and the file exists since I can open it with C-c C-o.
However, when I try to display the image, it does not work.
I see no reason why this shouldn't work.

By default this feature is disabled.
To enable it checkout the variable
org-display-remote-inline-image.For example, I set it with: