Image Upload?

What happened to the easy to use “upload file/image” button on the Edit Post/Write tab?
It was so much easier to click the button and have the pop-up window come up, select a file, click upload and then “add code to post”.
Why move this off to another tab?
I was considering upgrading from version 0.very_old to 1.2, but I’m not sure I will at this point unless I sit down and hack in my own file upload handler.
Any chance this could come back or be an option?