Many e-mails have pictures or clip art attached but all I get are those little red X's in the corner of the box where the picture will be. I have checked all my settings and have allowed pictures but still have the same issue. Any suggestions?

Check these:
1 - Internet Explorer is Show Pictures checked?
Internet Explorer > Tools > Internet Options >Advanced > check Show Pictures
(in Multimedia section) On a related issue do you ever encounter pictures not displaying on web pages? http://support.microsoft.com/?kbid=283807

2 - If the pictures/images are hosted - check that you are not blocking these sites in your browser or through your firewall

3 - Are the pictures being blocked in Outlook Express settings?
Outlook Express > Tools > Options > Security > Uncheck Block images and other external content in HTML email

4 - Are you blocking web bugs in your firewall? Either through a global setting or on a per site basis?

5 - When is the last time you scanned for virus/malware/infections? Any recent infections which may be still lurking in the shadows?

6 - Is your anti-virus software blocking the pictures/images?

Zee, thank you, I will check out each of these areas and see if that corrects the problem.

boomerang - you are welcome - Zee