If you were to hit the repy button a box for text shows up, just above the box there is a line of icons, the one that looks like a mountain is the one you need to hit to insert picture. I download pics to photobucket from my pc, then hit the mountain icon, copy and paste the link from photobucket into the box from the mountain icon. One thing I do is remove the "http://" from the mountain icon box before pasting the photobucket link in the box as the link already contains everything needed.
This forum has a separate pic server. You must log onto that server separately from the main forum to upload pics. Once your pics are uploaded, go to the photo in your album and look near the bottom of the page. You will see a box marked "Linked Thumbnail". If you copy and paste this link into your post a thumbnail version of your photo will be inserted into your post. If users click on that thumbnail, they will see your full size photo. If you click on the icon next to that box (looks like this:
), you will see a few more options. Copy and paste the "medium image" URL and the image will be directly inserted into your post. If you want the full size image, just delete the "medium/" out of the URL. Caution: Doing this will post the full size image - if this image is too big it will cause display problems with some users and they will not be happy. I would recommend never posting full size images that are bigger than about 800x600 pixels. If you post the medium image, users can click on them and see the full size ones if they are interested.