Thanks for the guidance.
This turned out to be easier than I thought it would be.
Open up a new email and go to the paperclip to insert. When the browse box comes up, single click to highlight the file you want to insert and go to the little down arrow on the insert button and select "insert as text" Voila!
Caution do not embed your images in the .htm document, rather include full "http:/" links to the image placed in your hosted site folder.
Email marketing on the cheap!