
Well, whataver you enter in the signature box is what's displayed in your signature.
Take the following image for example:

If you right click on this image (or most images that you find in google etc.,) it will give you the direct location of them, in the above case:
CODE
http://sneakymonkeys.com/img/afro.jpg
so to use this in your signature you need to wrap the above location in
CODE
[img] and [/img]
tags
e.g.
CODE
[img]http://sneakymonkeys.com/img/afro.jpg[/img]
or maybe use a different image:
[img]http://monkeyfiend.com/cat.gif[/img]
and so on...