Web Design coding and/or .psd needs 2 B changed?

I am using template 29 which is a hot sauce retailer. I am adapting it for an affiliate marketing site (see the uploaded index.html file). I have to get rid of the hot sauce and fire on the top and just want a blank pic to edit the elements from. I use Coffee Cup as an editor (it will do WYSWIG and Code) and GIMP for photo editing.

I can edit the site panel and the name, but when I remove main body it gets all screwey. How do I just build the top banner, the side links with mouseovers and the background image? In the attached index file, I am not sure how, but I created a table that laid over the main sections. This comes undone on longer pages. See websites.html. I am including the original template 29 and the inex.txt which is the index.html file )had to change the extension to upload it) and websites.txt.

Is the problem in the coding and/or that the .psd file that needs to be edited also?

Help... I'm Drowning.