Why is "Picture Cookies" good enough?
You're pulling those quotes out of context. Let's look at the whole thing:
Originally Posted by W3C HTML5 Editor's Draft
<body itemscope itemtype="http://schema.org/Blog">
<h1>Wake up sheeple!</h1>
<p><a href="news.html">News</a> -
<a href="blog.html">Blog</a> -
<p>Last Modified: <span itemprop="dateModified">2009-04-01</span></p>
<li><a href="articles.html">Index of all articles</a></li>
<li><a href="today.html">Things sheeple need to wake up for today</a></li>
<li><a href="successes.html">Sheeple we have managed to wake</a></li>
<article itemprop="blogPosts" itemscope itemtype="http://schema.org/BlogPosting">
<h1 itemprop="headline">My Day at the Beach</h1>
<p>Today I went to the beach and had a lot of fun.</p>
<p>Posted <time itemprop="datePublished" datetime="2009-10-10">Thursday</time>.</p>
...more blog posts...
<span itemprop="copyrightHolder">The Example Company</span>
<p><a href="about.html">About</a> -
<a href="contact.html">Contact Us</a></p>
Notice the div elements being used to wrap all the contents of the page other than the header and footer, and all the contents of the blog entry other than its header and footer.
You can also see microdata annotations in the above example that use the schema.org vocabulary to provide the publication date and other metadata about the blog post.
In the following example, there are two nav elements, one for primary navigation around the site, and one for secondary navigation around the page itself.
<h1>The Wiki Center Of Exampland</h1>
<li><a href="/events">Current Events</a></li>
<h1>Demos in Exampland</h1>
<p>Written by A. N. Other.</p>
<li><a href="#public">Public demonstrations</a></li>
<p><a href="?edit">Edit</a> | <a href="?delete">Delete</a> | <a href="?Rename">Rename</a></p>
<p><small>© copyright 1998 Exampland Emperor</small></p>
A nav element doesn't have to contain a list, it can contain other kinds of content as well. In this navigation block, links are provided in prose:
Notice the first two have lists in them.
<p>You are on my home page. To the north lies <a href="/blog">my
blog</a>, from whence the sounds of battle can be heard. To the east
you can see a large mountain, upon which many <a
href="/school">school papers</a> are littered. Far up thus mountain
you can spy a little figure who appears to be me, desperately
scribbling a <a href="/school/thesis">thesis</a>.</p>
<p>To the west are several exits. One fun-looking exit is labeled <a
href="http://games.example.com/">"games"</a>. Another more
boring-looking exit is labeled <a
<p>To the south lies a dark and dank <a href="/about">contacts
page</a>. Cobwebs cover its disused entrance, and at one point you
see a rat run quickly out of the page.</p>
The third one doesn't have a list. However, it does have a paragraph. It's additional text to give meaning to the links. That is perfectly fine. However, there is no "Pictures Cookies".