>>
>>Is the file local to this machine or on another machine? If it's on another machine, does the web server have a file share to it (or is the only way through http?)
>
>
>The files may be on this server or on another machine in our network. At this time I do not know how to access directories outside the current web structure, so as far as having share access, I am not clear on this. It would be most convenient to use the URL's which are already present.
>

Without testing this, I think something like this might work:

using System.Net;
// Code removed...

using (WebClient client = new WebClient())
{
   byte[] file = client.DownloadData("http://www.website.com/images/MyImage.jpg");
   MemoryStream stream = new MemoryStream(file);
   using (System.Drawing.Image bmp = new System.Drawing.Bitmap(stream))
   {
     // Manipulate image
   }   
}