It's one of the sample images on my HTC Wildfire S. The original is 6.92Mb in size and originally 1868x2802px in size. I got Nabble to set the longer side to 500px and centre it.
When I tap the Nabble "Insert Image" button, and then "Choose file", a dialogue appears to upload from the "Gallery" (or "Select Music Track" or "Voice Recorder") I selected the image from those stored in my gallery.
Even on wi-fi it took a fair time for the image to upload, (understandably, given the size). Only then did the image upload dialogue disappear and the Nabble edit window re-appear with the image code in place.
Maybe you're not waiting long enough?
Volunteer Helper - but recommending that users move off the platform!
Once the admin for GregHelp now deleted.