There are a few different ways you can upload images with an HTML galley. If your galleys include a large number of images, then creating a separate directory and FTPing them as you have been doing might be the most efficient way to go. You can also upload images during the HTML galley upload process -- after you upload an HTML galley, you are presented with an HTML Galley Edit page, which includes an image upload section. Images uploaded here can be linked to by the following tag:
<img src="uploadedImage.jpg" alt="...." />
... so you don't have to specify a directory.
You can also use the Articles XML Import/Export plugin to upload large amounts of content, including images. More information on this plugin (and others) can be found here: http://pkp.sfu.ca/wiki/index.php/Import ... rting_Data