You are using the hugo-book theme. This provides it’s own image render hook
themes\hugo-book\layouts\_default\_markup\render-image.html
looks like this is NOT the default mentioned in 5113
The default one is here: hugo/tpl/tplimpl/embedded/templates/_default/_markup/render-image.html at master · gohugoio/hugo · GitHub
Copy the content to your layouts/_default/_markup/render-image.html
Now the image shows up - so your general config is correct.
Check if it breaks other images on the site, logos…, maybe provided by the theme.
If somethings wrong, you’ll have to compare and adjust the code to support both.