I’m using a single vault attachment folder/relative path to file /MDlinks so embedded images will still work with most MD editors like Typora or when synced in Github when I want to read my notes on my phone. However, I tend to move notes around in the vault across different folders (ex. Inbox folder first, then to Project1 folder). This breaks the links for the embedded image files since links are not automatically updated.
Settings:
Automatically Update Internal links: On
New link format: Relative path to file
Use [[Wikilinks]]: Off
Default Extension for file attachments: In the folder specified below
Attachment Folder Path: attachments
Steps to reproduce
- Make a new note in root vault directory
- Insert screenshot in note:

This is compatible with most MD editors and image renders fine when viewed in Github. - Move note inside a folder in the vault (e.g., Vault/Test). The link to the embedded image is not automatically updated
Expected result
embedded image link will be updated to 
Actual result
link stays the same:

This renders fine with in Obsidian but broken in other MD editors or when viewed in Github.
Environment
- Operating system: macOS 11.2.1
- Obsidian version: 11.4