Insert/Edit Image in an Email Template

Hello!

I am trying to use the insert/edit image function for an Email Template.  When I searched the KB, it did not appear as if this button should even be an option?  Is this not something that we are able to use any longer in Enterprise? My button for the function is a little outdated compared to the cute one I saw for Sugar Sell. :) 

When I do try to insert an image I get this

I tried using a publicly accessible URL to no avail!

Any help or suggestions is greatly appreciated!!