You certainly can use an electronic letter head with the Front Desk Word Processor.
From the View menu, select Manage Header and Footer
Select Add Header and decide on which pages should have the header (All pages or First page only etc.)
Click in the header portion of your document and select Insert > Graphic
Find the image on your computer and select Open to insert it into your header. Please note that it is important to optimise your graphic header as large file sizes can start to add up in the database if you are attaching thousands of letters in Front Desk over time.