I think you're all missing a big feature of Microsoft products here. Have you done a right click on the image and chosen "format picture"? You can choose to position it under the "layout" tab in front of or behind text, etc. If you choose "tight", you then choose "right" or "left" or "center," etc. so there are different ways the text will wrap around it. Those "carriage returns" are taken care of after you go through these steps.

SRS