Hey, Tom, welcome back. And thanks for the really well-organized error reporting. Yours is the first example I have come across of "the problem" among MS mail clients. I have a group of friends whom I correspond with daily, and this picture-dropping thing ALWAYS happens after I receive WLM-embedded pictures from a friend running Thunderbird under Linux, but NEVER when they are back-and-forth between me (WLM) and others, all using MS Outlook.
When my pictures come back from the friend with Thunderbird, they are still embedded. But when then I reply or forward, they are stripped by WLM and remain so for everyone in the group. If the Thunderbird guy drops out of the group, and all messages are between me (WLM) and the other guys (Outlook), everything is fine over many generations (forwardings) of the messages.
I have reduced the subject mails to .txt files and looked at them with Notepad. There are big differences in the formatting of the mail, depending on whom it is coming from, but I have no idea what I'm really seeing and can't properly interpret it. I and others have forwarded these files to the WLM crew, but obviously they can't find what's causing this either. Really, though, would it be so hard simply to compare the mechanics of WLM 2011 with the earlier version, WLM 2009, which did NOT have this problem?
My Linux friend, who has no love for anything Microsoft, says that whoever wrote the code for the HTML rendering in WLM 2011 just got it wrong. Beyond me.