The end of the second line has the path pointing to /home/pictures/wallpapers. If you want to point to another folder that has your pictures, just change the path.
Sub-menus like the one above, can be placed inside of other sub-menus. Keeps it out of the way in general use, but is there when you need it. I wonder if fluxbox put a cap on how many sub-menus within sub-menus you can have . . . kinda cool to be able to see all my pictures three menus deep with one click, and execute a choice for my background with just one more.
Please comment if you are using this 'how -to'. All suggestions and comments welcome.