Hi Hugh,
I have a machine here running Outlook 2002 SP3.
If someone sends an Email with the picture pasted into it, it will display in the preview pane. However, if they attach the pictures, they will not automatically display, and you will have to open them from the attachments field in the Email.
As far as I know, this is the same for all versions of Outlook, and there is no way to automatically view attachments by default.
Sorry not to be more help, but there it is!
Somebody on here may be able to suggest an Email application with the same functionality as Outlook, but that allows you to preview attachments automatically. However, in my opinion, apart from that little niggle Outlook is far better than Outlook Express.
F - Wyg