Ciao a tutti, mi potete spiegare e dove sto sbagliando in questo codice

Codice:
<!DOCTYPE html>


<html><head><meta http-equiv="Content-Type" content="text/html; charset=UTF-8">
    <title>Nathan Rutzky - jQuery.dragmove</title>
    <meta charset="utf-8">
    <meta name="description" content="jQuery.dragmove is a lightweight jQuery extension for dragging DOM elements">
    <meta name="keywords" content="jquery, dragmove, drag, draggable, javascript, nathan rutzky, nathanrutzky, nathco">
    <meta name="viewport" content="user-scalable=0">
    <meta name="robots" content="index, follow">
    <script src="jquery.min(1).js"></script><style type="text/css"></style>
    <script src="jQuery.dragmove.js"></script>


<style>






div.picture1 {
   width:100px; /*width of your image*/
   height:100px; /*height of your image*/
   background-image:url('C:/Users/utente2/Desktop/MEM1.gif');
   margin:0; /* If you want no margin */
   padding:0; /*if your want to padding */
}




</style>


<script>
    $(function() {
        $('div').dragmove();
    });
    </script>   




</head>
<body>




    <div class="picture1">Drag Me</div>






</body>
</html>
perchè non mi compare l'immagine e me la sposta??

a me sembra di aver fatto tutto corretto...
sono alle prime armi, e sto imparando.

grazie