So I am running Baldur's Gate on windows 7, so I installed it out of program files since I want to be able to use CLUA console. The problem is that apparently it won't recognize custom portraits if it is not in the default install location. I want to have my cake and eat is too. Any suggestions guys?

I'm not sure where you're going with this, but the game requires any added portraits be installed in the (game)\portraits folder to be recognized. I use IWD portraits for BG all the time.

I know how to do custom portraits. I'm a BG vet. This is my first experience with the GOG version. And portraits are not working with me on this.

So you mean that when choosing your portrait and clicking the custom button, it shows an empty folder?
I'm on WinXP, so it might not help, but it works fine with any install location.

So you're saying that GOG baldur isn't picky about the install location? Hrm... Don't know what my prob is...

Yea it isn't picky, at least on WinXP. Did you double check for a typo or stray chars in the path?

As AndyBuzz said, with WinXP you can install wherever. But because of the later Windows versions security measures, you shouldn't install to C:\Program Files (or any Program Files directory). I've always installed to a another drive in a directory called Black Isle.

All GoG games can be installed anywhere. For those that require DosBox (which BG doesn't) you can't use the included shortcuts without modifying them, however. They're set for the one place I don't install to.

I'm on Win7 64 bit and have the game installed on a completely separate drive. I'll test to see if they work for me.

That would be awesome if you would test that. My research tells me my install location is the problem. But I'll go ahead and install it in the default and see if that does anything. I'm seeing the portraits but they're showing up with the question mark. I've checked and there is nothing wrong with my pics.

Okay, just tested and have no issues. Slightly more detailed info:

Win7 Professional 64 bit installed on a 64 GB SSD (Drive 'C', of course).
I have the GOG version of BG installed on on a 1.5 TB HDD (drive 'E', my Games drive). Made a female Elf Ranger and selected a custom portrait and had no issues during the character creation process nor at the beginning of the game. I installed the game as Admin and have the Privilege Level set in the Compatibility tab to run as Admin as well.

Hope that helps narrow down the issue for you.