report is on the left side next to the thumbs-up karma button.
In the OP it is on the top right. In the replies area, it is next to the karma button. The buttons will show always in the OP, but only on mouseover in replies.
Do not adjust your set, this is normal.
As for images, you need to upload to a hosting site like ImageShack or Photobucket, copy the Direct Link and insert it into the box that opens when you click Insert/Edit Image.