Steve, make a search in the group on 'relative' term - there are quite a few discussions of the topic.
Steve, I just implemented this for my team in Arbortext Editor 6.0. I based it off this tutorial I found online:http://communities.ptc.com/thread/33169
You will basically need to write some custom ACL code in dita.acl.
In Reply to Steve Fogel:
Is there a way to tell Arbortext 5.4 to insert relative paths instead of absolute paths into the href when inserting an image into a DITA topic?