Hi Kev,
Other Office products (Word and PowerPoint) support compressing images, but sadly InfoPath does not.
Normally, we recommend people just replace the images with links - i.e. upload images to a web site and replace them with links. We sell a qRules form plugin that does this automatically in the background when users add images. It's one of the most popular scenarios because the resulting XML is very small and very fast to open. The image will display with just the link, so best of both worlds. However, this requires a connection.
In your case, since your users are offline, this won't work. We have aanother product (DBXL Client) which provides standalone synchronization of InfoPath forms for offline users (something SharePoint Workspaces does not support). Users submit the forms locally (it's very fast). When they reconnect to the net, the software synchronizes with the server and uploads the forms. This approach also supports converting the images to links on submit, so subsequent opens will be super fast and the links will point to local images so all is good there.
Both products will work with IP2007 and MOSS.
Send me email if you are interested and we can arrange a demo.
Regards,