How to use Auto Upload Images

This is probably not needed. The WordPress built in importer already imports images into wp-content/uploads.

Make sure "ImageMagick" and "gd" is enabled in php.ini and properly installed on system
Also, maybe it is best to increase max_execution_time in php.ini
As you made changes to php.ini, restart Apache service
Install the Auto Upload Images plugin
Settings - Auto Upload Images
Save changes
Posts - All posts - Screen options
Change Number of items per page from 20 to 999, then Apply
Select all posts, choose "Edit" from the bulk actions dropdown, click Apply
You'll see a form with all your selected posts under a "BULK EDIT" field. Click Update without changing anything. It will take some time to finish depending on number of posts and your download speed.
If you have more than 999 posts, click next and apply the same trick there (select all, choose Edit, Apply, Update)
After you're done, click Screen options and change the pagination setting back to 20

It wonderfully imports images into WordPress Media library and updates the <img> src attribute automatically.