Okay, Aaron, I've got images in both folders when extracted, and the downloaded file views correctly throughout. But I am now seeing the issue with the AZW3 file showing only borders, beginning with "Tiger ran away" about 9 pages in.
Moreover, double-tapping on the missing image area does nothing, so no file is being referenced at all. Also, the cover does not appear in the carousel with the azw3 version, but does for the complete file.
Extracting the AZW3 produces images in both folders, but only 11 of them, ending with the last one that I saw in the opened book. I also got this error message from KindleUnpack:
Error: Referenced image 12 in style url was not recognized in <img style="width: 100%; height: auto;" width="1440" height="432" id="x0000_i1074" src="kindle:embed:000C?mime=image/jpg" alt=""/>
And then the same error for all the images after that.