inside ensureWithinStartNode also check if node is trashed otherwise go to startnode.

src/Umbraco.Web.UI.Client/src/views/common/overlays/mediaPicker/mediapicker.controller.js

@@ -250,7 +250,8 @@ angular.module("umbraco")
                 // make sure that last opened node is on the same path as start node
                 var nodePath = node.path.split(",");
 
-                if (nodePath.indexOf($scope.startNodeId.toString()) !== -1) {
+                // also make sure the node is not trashed
+                if (nodePath.indexOf($scope.startNodeId.toString()) !== -1 && node.trashed === false) {
                     $scope.gotoFolder({ id: $scope.lastOpenedNode, name: "Media", icon: "icon-folder" });
                     return true;
                 } else {