For some reason, I have NEVER been able to make this work with the Search Header paths.
My solution: in Prefix-pch (or wherever you want to import it, but Prefix-pch is easiest), #import "framework/Source/GPUImage.h" - maybe this is what you are supposed to do, maybe not. I don't really know, but the directions say just to use #import "GPUImage.h"
Also note that if you follow the directions in the readme, and simply drag the GPUImage framework to your project, you are only creating a reference. The library will still be in your downloads folder or wherever you unzipped it. This doesn't work for me bc all of my projects are in Dropbox for cloud backup and use on multiple machines. The way in the directions might be how some people like to do it. It might even be a best practice for all I know, but I like to have each project be self contained. My solution to that is to drag the zip file downloaded from github to my project folder and unzip it there. THEN drag the GPUImage project file to your project in xcode.
Hope this helps.