You have to set them up in Company Config
Then use System Setup -> System Maint. -> Image Maintenance to upload the image.
So it builds a repository of images, and a catlog of the based on the Category and Sub-Category. When you select an image (like in Part Maint), you’re just telling that part what item from the catalog to reference.
Edit:
The “File…” button on Part Maint is very misleading. you’re not selecting a file, but rather an image from the catalog of images uploaded in Image Maint.