If what you want to do is create another bbcode button that allows the user to include a URL link to an image (much like how the "hyperlink" button works), this will require some custom coding. The bbcode for images isn't included in the code by default for security reasons, but it's fairly easy to add into the code, most of the work is in creating a means for the user to use the code, such as including a special bbcode button for images. There are a few factors that needs to also be taken into consideration, such as restricting the size of the image so it fits into your blog space, some people will link to an image that's huge which could break your page layout. Do you want to allow images in the comments or just in the main blog post. Do you want options for text-wrap.
Now you're probably wondering what security risks could there be by allowing links to images. Well some using the Etano script may decide to allow non-members to post comments in the blogs and bbcode images could have some potential of being exploited, which I assume is one of the reasons why images were not included in the default code.
I included images in my blogs, but the route I took was hosting the images myself and included my own script that handles the image uploads especially for the blogs and once the upload is complete it produces the appropriate bbcode link for them to copy and paste into their blog field. The upload script I created also restricts the width of the image and also the max file size they can upload. I also only wanted images to be allowed by the creator in the original blog post and not by those leaving comments, therefore I didn't want an image bbcode button included in the default string of buttons used for posting and leaving comments.
Including images in blogs isn't black & white, there's a variety of variables and scenarios to consider that suits your needs and wants, which I also assume is another reason images weren't included by default. So what you'll need to do is figure out exactly how you want it to function and contact Dan for a quote.