How to both insulate and get a latch to work on this window? Foam kerf insulation strips

The main source of heat loss is not through the glass but through the gaps in the window frame and where the sashes rattle.

There are various ways you can reduce the air flow though the window.

The cheapest would be to install some cling film secondary glazing. This one looks like it just tapes up over the windows to keep the draughts out. Other systems use heat to shrink the film to size.

You could hang some heavy curtains. Make sure that they reach all the way to the floor and are plenty wide enough so you can have maximum gathering. If you line them as well there'll be two layers of fabric between the window and the room.

Next up is something like this from 365 Plastics. It's sheets of perspex cut to size and fastened to the windows with magnetic strips. We have this and it works quite well. The main drawback is storing the sheets in the summer.

A less visible solution, which you might want to use in association with one of the above is to renovate the windows with something like one of these draught proofing kits (others are available!). With these you replace the staff and parting beads with the supplied parts that include brush pile that forms the actual draught-proofing.

A wooden dowel sawed off to the right length to prop the window open is the traditional answer. You can keep the dowel on the sill when you're not using it.