I am thinking I’ll be reverting the one blog I’ve upgraded back to 2.3.3. I’ve installed a blank 2.5 to just play with to see if I can get things to work, and my suspicions have been borne out: I have yet to be able to upload an image and place it within a post using the 2.5 post page. On the one active blog I have upgraded I have had to resort to using FTP to upload the image, then coding the URL for it into the HTML for the post.
This one is a real turkey.