I experienced similar problems a couple years ago with Word 2000. My particular situation had been caused by corrupted printer drivers (don't ask how they got corrupted, 'cuz I don't know!). I uninstalled the printer from my computer, then re-installed it, then went to the mfgr's Web site and downloaded the most recent drivers. Took all of maybe ten minutes, and the prob was fixed.
As Dan says, there are other things that can cause this condition too. I'm just lettin' you know what worked for me. Sometimes converting the offending picture(s) into a different type of file like, say, a bitmap or .tif file or something, then re-pasting it into Word can help. (This can be done easily in Photoshop.) In fact, now that I think about it, I've done that in the past and it did fix the problem.
As a last resort, you might try the System Restore command within Windows XP (assuming your user is using XP). Send the machine back in time to before the prob started appearing. If the prob goes away, then start looking at what's been done or added to the computer since that date. I'd read up on this a bit before doing it though.
Incidentally, I wouldn't be reticent to simply call Microsoft. People blast them all day long, sometimes legitimately, but I've had good experiences with their tech support the few times I've needed it. There may even be a FAQ on this particular problem on their Web site.
Ken