I know you can use Workflow to add an image into a Word documents - we do it with signatures gathered on a Form process to generate an actual PDF letter with the signature included.
Here's some instructions - written by a Laserfiche team member - regarding how to do that: https://answers.laserfiche.com/questions/115453/Use-signature-collected-in-Forms-in-Workflow#repliestomain
And another post with instructions from a VAR user: https://answers.laserfiche.com/questions/145685/How-to-merge-signature-to-Word#145874
You should be able to do something similar, using the routing options in Workflow to determine which image to include based on the selected radio button options on your form, and then including it with the Update Word Document activity in Workflow.
The tricky part to work through will likely be getting the image where you can work with it, if you are not pulling it from the built-in signature field in Forms like those examples are using. I believe you need to have the images in a Base64 string. If you are using the same images every time, it might be easiest to find an online tool that lets you convert the image to the Base64 string, and then just include the string as a token in your Workflow. Or, if you are wanting to have the users upload the images as attachments on your form, you likely want to review this post that includes a script to convert an image to Base64: https://answers.laserfiche.com/questions/141495/Add-Image-to-Word-Document#141502 and this post that is talking about implementing that script to work on images uploaded to a form: https://answers.laserfiche.com/questions/159715/Add-Multiple-images-to-a-word-document-table#repliestomain
What it sounds like you want to do, should be very doable, but it likely going to require some larger setup and testing to get off the ground.