I think I have got there AT LAST.
I had to resize my pics to less that 500kB
Then select the "insert image "icon in the header which gives you a popup which you can then select and upload your image
Then go to "manage uploads" (only available if I "go advanced")
That gives a further window in which you can select and tick your required pic , drag it into the uploads part of the window
and only then you can "insert inline "