I don't have Outlook 2003 on my computer but I have Office 2003 which I assume is similar. In Word, for instance, I cannot locate files in the Libraries either. Libraries are actually just a mechanism that can point to several locations so all you need to do is to navigate to the actual location. For "My Pictures", when the File Open dialogue box comes up, navigate to C:\users\[user]\My Pictures. Once there you should be able to select a picture to attach.