I found the solution See below:
So the errors that were occurring with Windows Fax and Picture Viewer showing the "No Preview Available" screen and XN View opening up the picture in a weird color format were both caused by Entourage (the Mac version of Outlook). The problem occurred when the emails are sent out. They were being compressed to "Appledouble" format thereby changing the JPEG format from Truecolor (v1.2) to JPEG base form or CWYK (v1.2). The solution to this was to change the compression format from "Any Computer (AppleDouble)" to "Windows (Base 64/MIME)" and also making sure that compression was set to "None" (as opposed to "Stuffit").
For an individual email this was done by clicking on the little triangle next to the attachment line in the email. This will expand the attachment list and at the bottom of that list you will see an "Encode" button. Click on that button to get the menu that will allow you to make the changes I mentioned before.
For all emails to be set like this you must first click Entourage – Preferences. In the Preferences window, on the left underneath the group Mail & News Preferences click on the “Compose” button. On the right underneath the Attachments heading, change the coding from “Any Computer (AppleDouble)” to “Windows (Base 64/MIME)” and set compression to “None” (as opposed to “Stuffit”).
