This may be the essential part.

After entering the post the first time do NOT right-click on the word "Attachment" and use "Copy Link Location", or whatever wording your browser uses. This will NOT work.

Instead left-click normally to view the picture and copy the URL from the address bar. Copy this URL and not the "Attachment" URL into the image UBB stuff.

The trick is that the URL behind the word "Attachment" is not the same as the URL the picture is viewed under. The Attachment URL cannot inline to a picture, the other URL can.