As shown in the above image, all the necessary information have been filled but however the "OK" button is still disabled for me to proceed? May I know which part is going wrong?
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There is no a system image for API 20 in your AVD (CPU/ABI). You need to download and install one in Android SDK Manager. – user3806621 Sep 03 '14 at 01:56
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The dropdown box besides CPU/ABI shows No system images installed for this target
and is disabled. That's why the Ok button is also disabled. Either install the system image of the target you've selected (in your case, Android 4.4W - API Level 20
) via the Android SDK Manager, or choose another target with a system image installed.

TactMayers
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At my SDK Manager, it has two **System Image** available, may I know which one should I install? (Android Wear ARM EABI v7a System Image & Android Wear Intel x86 Atom System Image) – SuicideSheep Sep 03 '14 at 02:03
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The `ARM EABI v7a System Image` is the standard one to go. The `Intel x86 Atom System Image` may have better performance, but it may also be less stable than the ARM Image. – TactMayers Sep 03 '14 at 02:08