I am attempting something similar, and at the moment the tool I am using is https://docusaurus.io/ with the same set of problems to overcome. (Especially the photos problem).

I have considered using Obsidian Publish. My objective is to build an internal knowledge base: SOPs for a business. It won't be publicly visible. Obsidian Publish would require me to password protect the site, and that's an unacceptable addition of friction to day-to-day use.

Collaborative editing is the other problem to solve. In my world, "here's the repo on Github" draws blank stares. I have to use Google Docs or endless iterations of Word files.

Nobody will actually use an SOP in a Google Doc online, of course, and the trove of Word files on our server collects dust.

That's why a website (built using Docusaurus or similar) appears to be the best way to reduce friction and inertia. The path of least resistance should be the website full of SOPs, not "I remember how this works" or "I'll just re-invent the wheel."

I sympathize with your plight and I'm busily trudging along a parallel path.