Two methods of adding inline images are no longer working dependably and causing much grief. I've disabled those methods, but never fear, you can still attach images to your posts.
Beneath the section in which you write the text of your entry, there's a section labeled File Attachments. If you open that, select your image and then click the attach button, it will be included with your post. The image will not appear inline, but in a separate little section on your entry's page.
I'm looking in to restoring the easy inline image functionality, so sit tight! Technology is our friend... really.
Many thanks for your patience while this is resolved!
All the best,
P.S. If you want to learn some basic HTML (which you can use by default in your posts), check out this little tutorial that has all the common tags used in blogging.