Ah, I'll take this one. To get a picture onto the Internet, you have to upload it. How do you upload it? You get an account at one of any number of free image hosting sites. I myself use Photobucket.com. You just get the account, click "browse" in the upload section of your account to browse your computer for files, click on the one you want, and hit "submit". Then you copy and paste the code that Photobucket provides you with (it gives you a raw url, an html <img src>, and a BBCode [IMG]. You want the BBCode[IMG]) into your sig text here. That's also the way you post pictures in your posts and so forth.
I prefer ImageShack since you don't need to sign up or anything, it's pretty much instant, and it gives you loads of ways to use the picture you uploaded.
It won't work because first of all, your image is too large. Second, if you want the sig to apear as a picture, rather than a link, you will have to use the image tags: [img][/img] with the url of your pic in between them. But again, your image is too large (497 X 307), so it can't be shown.
I'll trim it down if you want and make it so you can use it. Just give me a sec. Also, someone drew that picture, so you'll have to get their permission to use it.