I'm done this a couple of times before. For a small single user system using a database with limited capabilities (e.g. MSDE and Access), I find it best to store the images in the database.
However, as the system grows (storage and users), and you have more and more images...
Buy a toolkit
Well, the easiest way to do this is definitely to get a toolkit - downside is $$$ and it will increase your installation package size.
I suggest either ImageMan or Pegasus Imaging - both do not require run-time licenses. I'm using both - ImageMan is much cheaper though.
MODI + MS Office Automation
This can be done in 2 steps:
1. Use the programmable Microsoft Office Document Imaging (2003 only) object model and viewer control to zone the image and perform OCR. The OCRed data can be accessed through the Layout object. See...