I am not sure what may be causing the issue. It doesn't sound like you are getting an error message such as the image is too large. But you may want to double check that the image is size to 800x600 (or smaller) and has a file size no larger than 293KB. Typically, photos right off of a camera or phone will be larger than this and require a quick edit to get them the right size.
Another possibility is the image is being uploaded, but not inserted into the page. When you return to the reply form, check to see if the image appears under the paperclip icon in the toolbar. You can select the image and have it inserted into your post. It will show as some code and not as the image. Once your post is submitted, it will show the image.
I hope this helps. We haven't made any changes to the forum in a long while. If you continue to have trouble posting images, you can try another browser and see if it makes any difference.