This is a pretty old question but it seems the poster didn't get what he is asking for. Hopefully this will help anyone who stumbles on this.
It seems like what the poster is actually looking for is a clipping mask.
His comment on Scott's answer:
ok... just in case... theres no way to group an image inside the stroke?
A clipping path is basically cutting through a certain image or shape or group of shapes by using another shape as a "mold" to cut through it. (Think cookie-cutter)
It's a very useful feature and is a bit similar to masks in Photoshop. Here's how to do a clipping path.
1) Select the shape you want to cut through (In this example, the red losange pattern)
2) Select the shape you want to use as the "mold" (in this example, the words "Extra Extra"). (Note: if you're using type as a "mold", it doesn't need to be outlined and can be live-edited. If you're using multiple shapes as the mold, they must be grouped together but not grouped with the shape you want to cut through. The same applies to the contrary. When using multiple shapes as the background shape, they must be grouped together, but you cannot group them with the mold.
3) Make sure the "mold" is on top of the shape you want to cut through. (Right click -> arrange -> bring to front"
4) Select both shapes.
5) Make clipping path using right click -> "Make clipping mask" or the "Object -> Clipping Mask -> Make" menu. (This won't be available if both objects are grouped together.
6) You can then "release" the path or move it using the direct selection.