I think there are two ways to deal with the pictures, maybe three.
1. Everyone that has a HowTo submission should have a photobucket account and upload all the pictures there.
2. Host the images ourselves here (bandwidth issues though to say nothing keeping it all organized)
3. Downloadable documents with the images embedded.
My vision for the How To section was to have the web accessable How To's, that is to say that you could go and pull up a web page and see everything, but also do hard copy write ups that could be downloaded and have the pictures embeded in the documents (you will find all my HowTos this way). That way, for some reason if the web accessible pictures went south, you still have the hard copies.
Furthermore, with the hard copies, one can save them to their hard drive for future reference, to print out in a nice easy to read and follow format, or to share with other people. In addition to that, the hard copy would provide a way for the document to make rounds through out the community to be improved upon and to grow. That point alone is worth all the trouble to me.