I am successfully using the INCLUDEPICTURE command, and using a "mail merge"
field to identify specific .tif files I want to use as page 2 of a letter.
When I view the document, the correct .tif files are being created.

Once the Word 2003 goes to print the .tif file from the first record
propagates to all subsequent records. The command I am using looks like this

{INCLUDEPICTURE "J:\\abc\\{ MERGEFIELD "Reference" }.tif" \*MERGEFORMAT}