I'm old enough to remember reading this reposted on usenet (or was it gopher) at the time. Cue discussion about how gopher was much better as it already did images.
There was also serious backlash from certain people (cough TIM BERNERS LEE cough) that adding images to the web would degrade the user experience, encourage bad use cases, and encourage the riffraff to use it.
But it did degrade the user experience, encourage bad use cases, and encourage the riffraff to use it. The easiest way to eliminate those problems is to not have users.
Why'd you have to go making things popular? I could still be using Lynx on a 1200 baud modem!
WorldWideWeb had image support well before this (in a separate window?), and certain included inline images c1993-1994. Seems like an odd thing to do if Tim didn't like them.
Little did we know back then...