Learn French: En traversant cette ruelle, j'entends un corbeau et une porte qui grince. - While crossing this alley, I hear a raven and a door that creaks.

This is the French gerund. It is formed with the preposition en followed by the present participle (the -ant form of the verb). It is used to show that two actions are happening at the exact same time by the same subject. Here, you are crossing the alley at the same time you hear the raven.

The translation says "a door that creaks", but doesn't que usually mean "that"? Why use qui here?

In French, the choice between qui and que depends on its grammatical role, not the English translation. Qui is used when it acts as the subject of the following verb (the door is doing the creaking). You would use que if it were the object of the verb (for example, the door that I open = la porte que j'ouvre).

Is ruelle related to the word rue (street)?

Yes! The suffix -elle is often used as a diminutive in French, meaning "small". So, a ruelle is literally a small street, which we usually translate as "alley" or "lane" in English.

If there were two creaking doors, would the verb grince change?

It would! Because qui acts as the subject, the verb that follows it must agree with the noun that qui replaces. If it were two doors, the verb would take the plural form: des portes qui grincent.