What a downgrade! Why have your broken image display in outline view?
Outline View is one of the most powerful ways to organize large amounts of structured text in Word.
Until the last update to Microsoft Word for Mac v16.16, it was possible to display images in Outline View if the document was saved as .doc but not .docx - already a strange limitation. Now, with the latest update, no downgrade!, you have broken this as well. For me this means, I cannot work with the latest lousy version and have to revert. At the very least, you should be upfront about which important features you break with an alleged upgrade. You managed to break customizable icons a while back (still not remedied because the supposed fix stingily requires 365).
If you actually want to make Word better, it's not wizardry to display images in Outline View. You showed that yourself in previous versions. Make them visible. There's no good reason to just show a ghost block instead of the image (see screenshot below).
See also https://is.gd/r3oXZP