Perhaps it's time for you to purchase Dreamweaver CS5 "Classroom in a Book"!

I'm not directly familiar with this textbook... If the navigation is the blue text (Features - Fashion - Calendar - Video - Blog), it would typically be handled in HTML using an unordered list (ul), with each list item (li) containing a link (a) that surrounds the text itself. CSS would be used to position the navigation, perhaps applying display: inline or float: left to the list items (li) to make the list run horizontally. The list itself might be positioned within a surrounding div using margin or padding—or even using absolute positioning (in a relative context), given that there's probably a specific height to the background image (the "check" logo).

As far as links go, they're traditionally inline elements that wrap around other inline elements—like text within a paragraph or heading, or an image. However, I think as of HTML5, they're also allowed to be wrapped around multiple block-level elements. Regardless, the simplest way to add a link to an image is to surround the image (img) tag with a link (a) tag. However, like your book says, if an image is being applied via CSS as a background image, it cannot have a link applied to it, because it's not part of the HTML. But a background image must be applied to some HTML element, and perhaps the link could be applied to that element.

A link can also be converted to a block-level element via CSS using a display: block rule. This will make it occupy the full-width of its container, which can make it more "clickable" by giving it a larger area of interactivity.

Not sure if this information is helpful or not... I wonder if the book goes on to answer any of your questions later on. Often, these types of books complete a project step-by-step, chapter-by-chapter, eventually addressing issues brought up in earlier chapters.