Unfortunately, it really can't be done.
1) Office Web Apps isn't really licensable for use in an extranet
scenario.
2) Office Web Apps would only solve your problem for Office documents,
not for PDFs or pictures.
3) Rights Management (DRM) requires installation of a client which
again won't work in an extranet scenario
4) Without custom code Rights Management only works with Office
documents, not PDFs or pictures.
5) Even when displayed in a web page a picture is downloaded to the
client's PC in temporary storage.
6) To even view a PDF, Office Doc, or picture it has to be downloaded.
The bottom line is that there just is no real way you can accomplish what
you client's legal department is asking for. You can secure PDFs in such a
way that they can't be printed, but that's about the best you can do and
there are multiple programs available on the Internet that will break them
open and re-enable printing if someone really wants too.