Nevermind.
I bit of looking and I found the answer at: https://forum.vassalengine.org/t/reducing-mod-size-remove-old-images/2730/1
As the previous topic mentioned, the tricky is to zip the file inside the Unzip folder at the same level as the BuildFile that consists of all the files you want to include in the new module. (What you don’t want to do is select the entire Unzip folder from outside the folder and just zip it. This will produce an invalid module.)
Thanks to previous posters.
Joe