What I would suggest doing is create a document  library with the
template "Microsoft FrontPage" applied to it. This will automatically
allow you to create new .htm pages  and update .htm page and edit them
directlly in Front Page.

To do it this way, your HTML pages  would need to have a valid reference to
the images. Using the browser, you could put the images  into an Image
Library. Alternatively, using FrontPage 2003, you could separately put the
images into your Site's /image directory. In fact, using FrontPage 2003, you
could put the entire HTML page and it's images anywhere you'd like. They
don't have to go into a Document Library.

If FrontPage 2003 is not an option, you could edit your HTML pages in Word.
Word can create a 'single file-ish' like format (I don't remember the
extension, but I think there are two flavors). However, Word produces
hideous and bloated HTML (tons of style tags), but it may be the solution
you are looking for.

One option is to open the page in Internet Explorer then save it as a web archive (.mht) file. This format contains the page and the related graphics and can then be uploaded into a SharePoint document  library.

To do this:
1 Open the page in IE
2 Select File, Save as
3 Change the Save as type to Web Archive, single file (*.mht)
4 Select an appropriate place to store the file temporarily
5 Name the file and select OK

Now you can upload  the saved file into a document library  then delete the temporary file. This is a simple way of saving a web page for archival purposes. Other solutions we have employed are print to TIFF or PDF conversion programs.