Can we use a craft as one of the ideas or does it have to be a story or article?
A craft is excellent since it has a high likelihood of being publishable with the most minor of revisions. I love it when my students do crafts because then I can really know we have a piece we can sell pretty easily.
Also, if we submit pictures for How To articles: I know we don't layout the pictures in the document....so do we just send high resolution .jpg (or whatever) files with the manuscript and indicate where they'd correspond to the text in the document?
Now, if you want to put the pictures with your ASSIGNMENT -- it's okay to past them into the manuscript and then just TELL your instructor that you know you would not do that for a submission for publication. It's really the easiest way to do it for an assignment and we're okay with it as long as we know that you know you can't do that when subbing to a magazine.
Now, for a magazine...if sending by email, you tell the editor you have high-resolution graphics to accompany the piece and can email them immediately on request. Editors tend not to like odd attachments so you have to tell them, then email when they are asked for.
For a magazine sent by postal mail, you print out the high-resolution graphics into beautiful print...really nice looking prints on photo paper. Then send them in a photo mailer and tell the editor in the cover letter that the graphics are also available as hi-res electronic files if she wants them that way. But the editor wants to see them printed out and she wants to see them looking just like a traditionally printed photo when she's evaluating the manuscript sent by postal mail.