DG, you've got some extra tags in there you don't need.
All you need is [img]URL%20of%20your%20image[/img]
You can paste in the URL of any image, eg:
http://www.mywebsite.co.uk/images/my_image.jpg
and then just highlight the address and click on the Img button and it will insert the tags for you.
The other golden rule to remember with posting images on the forum is that they should be no more than 425 pixels wide to avoid horizontal scrolling.