What you need to do is the following:

  1. Locate the report in Administration > System > Edit Reports that you want to add images to.
  2. Click 'Copy' to make a copy of this report. Give the copy a new name.
  3. Click on 'Edit' for the section of this report that you want to add
  4. If this is a Summary Report, make sure you change the 'Standard Section" from the "[Artifact] List" section to the "[Artifact] Details" section as only the detailed sections will include the attachment list.
  5. Inside the XSLT definition, for each item in the report, add the following XSLT template snippit:
      <xsl:if test="Attachments/Attachment">
        <div class="Title3">
        <xsl:for-each select="Attachments/Attachment">
          <img style="border: 1px solid gray">
            <xsl:attribute name="src">
              ../../Attachment/<xsl:value-of select="AttachmentId"/>.aspx

This approach works with SpiraTeam v4.0 or later and works with the HTML, MS-Word 2003, and PDF format reports.