It sounds like you are typing the HTML code directly into the body of the message.
I'm not 100% certain if my suggestion will accomplish what you want to do but I suggest you create the HTML formatted text in one program such as Word, save as HTML, then copy the HTML formatted text to the Clipboard, then paste it into the body of the message window using Edit | Paste Special. I don't have time to try the suggestion since I'm off to work soon but I remember using Edit | Paste Special for something similar a few months ago. I believe I assisted a co-worker with inserting an Excel spreadsheet into a message.
Perhaps someone on Anandtech with more experience with the Outlook application will share some knowledge with us.