I've just read Todd Lockwood's novel The Summer Dragon A good read, and as a writer/artist myself, I really enjoyed seeing pieces of his artwork included. I'd love to see more of the same in other novels.
I plan to have illustrations in my story. I love it when people add them in. To bad it seems to be almost taboo. I love concept art especially and I think thats a perfect art style for novels.
Tolkien's illustrations in The Hobbit have always appealed to me.
I love the mix of illustrations and text in Terry Pratchett's Last Hero [illustrated by Paul Kidby] and Eric [Josh Kirby].
It's [more than] a graphic novel but not [just] a novel, I think Watchmen is incredible in blending things together. Writer Alan Moore, artist Dave Gibbons, and colourist John Higgins [he always seems to be forgotten ] are at the top of their games. I like the film [ducks to avoid thing being hurled at me] but the original book is so much better...
I haven't created illustrations for any of my novels (aside from the covers and title page) but I have done a couple children's books with my art, a picture book and a beginners' chapter book. Obviously, those sort of books require illustration. Some of my poetry books have my own pictures in them, some have other people's art. Honestly, though I am a decent painter, I do not think illustration is my strength. Plus, it just takes too much time when I would rather write.
A Natural History of Dragons by Marie Brennan (which I read recently) has some pretty nice illustrations included throughout. It's written as the memoir of the narrator, and she's an artist, so it fits.
As for me, a couple of my ideas I'm processing present themselves to me in a visual medium; I want to write them as graphic novels. I'm not a particularly great artist at the moment, but I'm confident I can get much better. I want to bring these stories to life, anyhow.
My art thread contains characters and scenes from the novel i'm currently working to finish. I would love to publish an art book or include my illustrations if i'm ever lucky enough to publish. I always enjoyed reading novels with illustrations included!