How to split or cut raster image object that was placed in Adobe Illustrator?
The Knife Tool doesn't work on raster images.
Images can't be cut using standard tools in Illustrator because it is a Vector editing software. (Your images are raster)
Your options are (ordered from most ideal to least)
Use a clipping masks.
Use Photoshop (or other Raster editing software)
Use autotrace to make the image Vector and then you can cut it how you like (problem is, you'll have many paths)