More comments:

The "Category 3" in the display is the "image not found" alt text for the "DVD Movies" demo category, so the example images are not in the right place.

Your code snippet shows you applying the heading image to category 10, but the demo store has no cPath = 10, so your code will not be applied to anything. You need to verify the cPath of the category you want to test with the URL in the address bar at the top of the screen.