Problems using HTML in Entourage

I use Entourage 2004 for all of my Email and I'm having a problem using HTML with it. I have it selected to use HTML as the format of my emails and even have it selected to use the format that email was received in when responding or forwarding emails.
Yet at times I copy and paste HTML from a document or web page but when I paste it in Entourage it shows up as simply text, none of the formatting of HTML or even the pictures. I received a email today in HTML which I tried to forward to several people but once again it did the same thing, not showing up in HTML. I used to use Outlook 2003 and never had this problem. What could be causing this or am I doing everything right and this is how Entourage works? It wouldn't make sense since I'm selecting HTML but does it have something to do with selecting something for showing pictures?