This link: importing-eps-files-into-inkscape contains a very detailed tutorial on how to do this and it worked perfectly for me. It is based on instructions found at inkscapeforum.com, specifically this quote from eelke:
Inkscape's PS and EPS import now uses Ghostscript instead of pstoedit. If you need to open files of these types, install Ghostscript and make sure the directory with the ps2pdf utility from Ghostscript installation is in your PATH. On importing a file, you will see a preferences dialog, similar to PDF import; for multipage PS files, this dialog allows you to select which page to open.
It works only when you put both links; "bin"and "lib" from Ghostscript in : exc. C:\Program Files\gs\gs8.70\lib;C:\Program Files\gs\gs8.70\bin
Start -> Control Panel -> System -> Advanced; Click on Environment Variables, under System Variables, find PATH (or make it in the new..), and click on it. In the Edit windows
That is the gist of the solution. The tutorial in the link at the top of this answer shows how to do this step-by-step with pictures.
The JPEG standard has a number of file compliancy variations which were created for specific reasons, two types which are often used are EXIF and JFIF.
Although both files are classed as JPEG files and appear on a computer with the JPEG extension the difference is due to the supplementary data which is added to the original image during processing in camera or in computer. This data is usually stored in an areas that are called "APPn" (where "n" is the number 0,1,2 etc).
Most imaging software applications can open both types of JPEG file, but most digital cameras can only display EXIF format images. When a EXIF file is opened in an imaging program like Photoshop and then saved, the file is changed into a JFIF format with a result that the image can no longer be opened by the camera and the shooting data is lost.
EXIF
The EXIF format was created for use in digital cameras, the APPn stores information such as the state of the camera when the image was recorded (shutter, aperture white balance etc).
JFIF
The JFIF variation is commonly used in the imaging industry, most software applications save files in this format. JFIF uses the APPn to store information such as copyright and captions (IPTC text) and profile information for colour management (icm data).
You can try ExifTool and run this command, but it is possible that your camera will be unable to display the images, as the shooting data is lost.
exiftool "-exif:all<jfif:all" "-thumbnailimage<jfif:thumbnailimage" FILE
Best Answer
Updated: This should work (-flatten did the trick for me)