I have users who like to embed pictures directly into the email
message. I.E. screenshots and other graphics. When the picture is
embeded it appears groupwise stores it in a BMP file and then (I'm
assuming) uses the viewer to display. I've seen this take 60 seconds
or more to display what can be translated to a 4MB file.

The question I have is, is this anticipated/normal behavior for this
type of action?

I know you can send the same picture/graphic as a JPG attachment and
it opens almost instantly.

Is there any known performance issues with the viewer? If so, is
there any kind of workaround for this type of scenario?

2012 SP 2 backend
2012 and 2012 SP 2 clients on Win 7