a couple of things:
1. You have a syntax error in your Passage example, there is a colon character between the img element's src attribute name and it's value instead of the required equals sign character.
2. Folder / File names.
Web-based technologies are very particular when it comes to a folder / file name, because of this it is generally not a good idea to use either mixed cased (upper & lower case) letters or space characters, nor is it a good idea to use punctuation characters. Two exceptions to this later point is the standard dash / minus sign and the underscore character, both of which can be used to separate the words within a multi-word folder/file name.
/* Bad folder / file names */
/Mixed Case Folder Name/File With Punctuation within it's Name.jpg
/* Good folder / file names */
/media/game-over.jpg
3. Relative URLs
The relative part of this topic relates to the fact that the referenced file is stored relating to the HTML file making that reference. So in your folder/file structure example you have the following:
a. A top level folder named CENTON removable USB which is located on your C: drive.
b. A folder named Media for projects which is a child of the folder in point A.
c. A Story HTML file named Knight's veiw.html which is stored within the child folder in point B.
d. A image file named game over.jpeg which is also stored within the child folder in point B.
Based on the above structure the Relative URL required to reference the game over.jpeg image file from within a Passage contained with the Knight's veiw.html file would look like:
<img src="game over.jpeg" alt="GAME OVER">
Personally I would change your folder / file structure to something more like the following.
c:\CENTON removable USB\
Knight's view project\
knights-view.html
media\
game-over.jpeg
a. A top level folder named CENTON removable USB which is located on your C: drive.
b. A folder named Knight's view project which is a child of the folder in point A, and is used as the parent folder for all things related to this project.
c. A Story HTML file named knights-view.html which is stored within the parent folder in point B.
d. A folder named media which is which is a child of parent folder in point B., this folder is used to store all media files referenced from the Story HTML file.
e. A image file named game-over.jpeg which is stored within the child folder in point D.
Based on the above structure the Relative URL required to reference the game-over.jpeg image file from within a Passage contained with the knights-view.html file would look like:
<img src="media/game-over.jpeg" alt="GAME OVER">