It's much harder to describe than it is to do. Pokey and 090 have done a good job of describing it, and I'll add my version. I reckon after our efforts you should be able to figure it out.
There are two options:
1. As an attachment
2. As an included image
To do the first, you have to have an image on your hard drive, and it has to be the right size to be accepted (under 128kb in size). Once you have an image, start your post. You'll see down below the box where you type your message a link that says "Additional Options". If you click that, you can use the ATTACH box to insert your image. Use the BROWSE button to find it and have its name and file path added into the ATTACH box. Then when you post your image, it appears as a thumbnail that anyone (who is logged in) can click on. Example below.
To do the second, you need to have an image uploaded onto the Internet, somewhere. For example photobucket or Flickr or somewhere, even your own website. Then, you get the path to that image (ie the URL), either by looking at it and copying the path from your browser's address bar, or by right clicking on the image when it's displayed, selecting properties, and then copying the path to the image file from that. Then, in your post on OzVMX, select the 'Insert Image' button. That's the second button from the left in the bottom row of buttons just above the text box where you type your post. When you click this, it places image tags in your post.
[img][/img]
. Place your cursor in between those, and paste in the image URL. That's it...
Here's an example:
In code it looks like this
[img]http://www.ozvmx.com/images/forum/husky500.jpg[/img]
Hope that helps...