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.
In Dreamweaver, if that image is in a cell of a table, for example, make it a background image for the cell. That will allow you to place links on top of it.
Thank you groove25 and Ms. Nicholls,
I'll try using a div within the graphic div tomorrow. I think you see that my problem is how to position a link using CSS and without resorting to inline code. I did a quick look for an answer to the problem later but didn't see one.
I'll let you know how your suggestions work.
P.S. You are right, the blue text "Features - Fashion - Calendar - Video - Blog" are ment to be links, but that text was not exported as part of the background image. It is meant to be added overtop of the background so that it can be changed in the future.