Ok, I have commented out lines 43 through 80 in the InsertImage.php file and set all of the 'AllowUpload' elements to false in the Admin, Default and Guest .config files. That visually worked but adding an image location (i.e.http://cutesoft.net/Themes/default/images/common/title.gif) and clicking 'Insert' does nothing and I now recieve the following javascript error:
TagetUl is undefined
var OxOfccd=["zoomcount","wheelDelta","z...0x69]]= new Function(OxOfccd[0x68]) ;} ;