When typing out a reply, click on 'Go Advanced' below the Quick Reply box which will take you to a text box that has many more options. The easiest way to include a photo is as an attachment. If you scroll down below the 'Go Advanced" text box, you'll see a 'Manage Attachments' selection. Choose that and you'll be asked to either upload from your computer or upload from a web site. Locate what you what, upload and voila, it's done.
Dave