if the image files are in the same folder with your data source file, the csv file, then you need not the whole path in your data source. Don't know why your paths do not work. For that we need some screenshots showing your file system's folder of your image files, the position of your csv file in your file system and the contents of your csv fie for at least one image that should be merged.
Hm. Could be that the path to your image file has a special character so that data merge fails.
Or that your data merge source csv file must be saved in a different way…
Without access to sample files this is hard to tell.