The picture option is not present in the quick reply box inless you use the "go advanced" button. You have to use the Post Reply option to see it wthout that function. Either way with the post reply or "go advanced option you then you see the familiar paper clip icon in the middle of the editor box. Click on it and it brings up the browse/upload box as an attachment. We have a 300kb limit here and a 1000x800 pixel limit. Hit upload. The picture will upload and appear below the browse functions as an upload attached like an email you'd send. It will list your attachments in the file manager. When you are done just hit the close window box in the upper right corner and hit submit. The image will appear as a thumbnail by default. You can use pictures hosted somewhere else by using the little yellow floppy in the quick reply box above or on the full reply editor. Just insert the url for the picture.
ALL OF THIS IS SPELLED OUT IN THE FAQ GUYS. READ THE INSTRUCIONS FIRST IF YOUR HAVIONG PROBLEMS.
When using Photobucket, check the little box under the photo you want to post. Then scroll to the bottom of the page and click the button on the right labeled "Generate HTML and IMG code". This brings up a list of codes for you. Highlight and copy the code (text) in the box labeled "IMG clickable thumbnails for message boards - recommended" (usually the 3rd choice down) and then paste that code into your post. The picture will then appear as a clickable thumbnail in your post. You can use the "preview post" button to make sure the picture will post the way you want it.
GregC&R gets credit for teaching me how to do this. It works great.
If you have any trouble, drop me a PM or email at [email protected] and I'll be glad to help.