Drag and drop image from Windows Explorer to Outlook email (2013) as inline image

Add "Copy as image" to the Explorer context menu. Paste in Outlook.

Part 1: nircmd

Use the utility nircmd to copy the file to the clipboard as an image. Then, paste the image into Outlook.

nircmd.exe clipboard copyimage <filename>

Part 2: Add to context-menu

For efficiency, consider adding this as a context (right-click) menu item.

1. Download and extract nircmd to C:\utils
2. Create the registry key: HKEY_CLASSES_ROOT\*\shell\Copy as image\command
3. Set the (default) value of the key to C:\utils\nircmdc.exe clipboard copyimage "%1"

This add "Copy as image" to the context menu for all files (not just images). If the file is not an image, the command does not copy anything.

For this solution to work only for specific file types, perform the steps above and replace the asterisk in HKEY_CLASSES_ROOT\*\ with the file type in a special key (example: HKEY_CLASSES_ROOT\SystemFileAssociations\.png\).