Images in Outlook 2003 signatures

I’ve been trying to set up email signatures in Outlook 2003 for a customer today and it’s been a real headache.
The whole thing seems to work fine until you actually attach the signature to an email or send it and then your image is gone and you’re left with that horrible red x. I had a search around on the net and there doesn’t seem to be a definitive solution, even the guide on the Microsoft Office site doesn’t seem to work.
Anyway after some head scratching I managed to work out the solution! So I thought I’d add it here, you never know, it might help someone!

The first solution is to go: Tools > Options in Outlook 2003. Then click “Mail Format” and then “Signatures”. Now click Edit/New (depending on whether you have already created your signature or not). The trick here is, dont click advanced edit, just use that little box (right click then click add an image if you want to add your image). Then hit OK and the whole thing should work fine.

The next solution is for people that have to use Word to edit their signature for whatever reason. You have to edit some settings in Word and Outlook for this. Here’s what you need to do:
MS Word:
Tools->Options->Save->Disable Embed Smart tags
Outlook:
Tools->Options->Other->Uncheck the Person Names Smart tags

Hope that helps!