Free Fairy Pictures public domain
This is provided by Project Gutenberg at http://www.gutenberg.org.
You can browse their archives to download books which are in the public domain.
This html page of fairy stories has many lovely vintage fairy pictures (and gnome pictures) which you can download by right clicking on the image shown on the page (please click this link first to go to the page):
Here are some of our favorites (you can download these directly)