Can you still use items in the wardrobe even if the item image is blocked?

Nope.... (at least not with ad-block plus for Chrome) if you block an image with that, it automatically removes the image from the (beta) wardrobe page - you don't get a broken image or anything, so you can't click it to add to your HA.

wooooooonderful XS headdesk Thanks I think XP snugs

Aaaactually, it depends. I block items from shops when I buy them, so I don't see them again and I focus on trying to buy the items I haven't got yet.
And yet, when I get doubles to add to my wardrobe, or even when I'm looking in my shop and inventory, the image DOES still show up. It only blocks the shop image.
Now, I'm not sure where you're blocking the image from or why, or WHY THE HELL it works like that with the shops, but you ... should still be able to see the item image, in your wardrobe, if you're blocking it from the main shop, at least.
bird and bear and hare and fish give my love her fondest wish