I always want to place a photo somewhere other than at the end of a document. How can I change the default setting so this is allowed without having to go to Preferences, attachments and un clicking the default setting?
Drag and drop the photo into your message. Wherever you let go, that's where it will be. So if you let go in the middle of your message, it will be in the middle.
Edit: Here's another option: There is a paper-clip button on the compose new message window, which you can use to attach a photo. If you do that, the photo will appear wherever your cursor is at the time you click the button. So put your cursor in the middle of your email, then click the paper-clip and select your photo.