Hi,
Welcome to the Microsoft Q&A forum!
Have you tried the method mentioned in this article? https://www.extendoffice.com/documents/outlook/4013-outlook-reply-removes-images.html(Note: Since the web site is not hosted by Microsoft, the link may change without notice. Microsoft does not guarantee the accuracy of this information.)
If this doesn't work, please consider run this command to check the ContentType:
Get-RemoteDomain | Format-List Name,ContentType
Please feel free to contact me for any updates. And if this helps, don't forget to mark it as an answer.