should I just use the open book as a background image and write a type of layer over it
When you said "Of course, this assumes that you have openBook.gif in the same directory as the html file that includes your applet code and that the book picture is the proper size." The open book will be approximately twice as large as the closed book, will that be alright?? Or did you mean that the gif should be able to fit into the applet?
<APPLET CODE = "BookApplet.class" WIDTH = 200 HEIGHT = 100>