I don't think exactly think so.
It's just information to show the mail (and the links inside it) in the receivers Outlook the same as in the senders Outlook, as I understand it.
Images which embedded in a Word document are embedded inside the Word document, and not sent separately, and are immediately visible and printable if you open the Word document, which will be fairly big.
However, your friend can have chosen not to embed the images in the document, but to insert links to separate files (one file for each image) on his hard disk instead (Word lets you choose from these alternatives). The Word document is fairly small than, but to read it on another computer, you have to copy all those image files to that other computer also, AND (most important) have all the files on exactly the same location (say, My Documents\My short stories\A midsummer night\Pictures) or the links on the receiving computer will point to a location that doesn't exist, so the pictures won't show up.
A CD-burner nowadays is rather cheap. Things might be easier for you and your friend if he bought one. He might have more personal files he likes to backup than just this one story and its images?