Setting up signature in Live Mail with logo, logo will not show when using signature

Im setting up out email with Live Mail.  Found how to create signatures by laying it out in a new email message as well as inserting images (our logo), then saving as an HTML file.  Then when adding the signature, you tell it to use that HTML file.  Ok, did all this but now when I start a new message, the entire signature is there but the logo get the red X.   I repeating these steps several times with no luck.  I also made sure to put the images in the same folder on the computer with the HTML file thinking that might affect things but no change.  Even made sure to use no spaces in the file names.  In addition, Ive seen posts online saying to uncheck the blocked images section under security which I have done and still no change.  Whats keeping the images from showing when I apply the signatures?