Go to the Image Hosting tab and select the image you wish to attach. Click the attach button, and on the next page where you see your image you will have the option to select eBay and send it to your existing auction.
It will ask your username, password and item number and attach the image for you without needing to copy/paste the HTML code. Otherwise, if you want the code to place the image someplace more specific, select to list your image to 'other' and it will give you the code to use instead.
