Here is the “yellow flower” image. The “embed” code from the SkyDrive page is inserted here:
It shows up in Windows Live Writer as a small image.
It works as expected in Preview mode where the image hyperlinks to the SkyDrive page.
The embed code is an “iframe”. Such constructs are subject to misuse and consequently not permited on WordPress.com. Since this blog is not hosted by WordPress.com that restriction is not enforced here. Confusing, yes, but that is our modern world.