Gmail – Automatically download all attachments from Gmail with a specific label

More than likely this was functionality that Google was rolling out gradually and your co-worker simply hadn't gotten it yet. This is very typical of how Google implements new functions, I expect so that they can halt the deployment if it's found to have an egregious bug and minimize the damage.

Generally, the only thing that can be done is to wait for the rollout to complete.

At this point the general consensus is that there is no way to turn off this "embed images" function of the otherwise "drag-to-attach" feature of the new Gmail.

There are a few criteria to keep in mind though, circumstances in which attachment will occur rather than embedding:

• Dragging in multiple images simultaneously (using multi-select, shift-click, ctrl-click, window, etc) will attach the images rather than embed them.
• Dragging in non-standard or proprietary image formats, such as PSD, will attach them rather than embed them.

Otherwise, if you want to attach a single image of a common format, such as JPG, you'll need to click the paperclip button at this time.

Hopefully, the Gmail team will recognize the issue and allow for some sort of option or setting or other mechanism for simply attaching single images in the future.