Possibly Senky's Simple WYSIWYG editor
(a lightweight "what you see is what you get" editor) might be what you're looking for. As shown in the preview screen shot there, it gives you an editor where both text and images are seen formatted as you edit, instead of seeing only the BBCodes.
If you only meant specifically being able to "paste images", Senky also made the Clipboard Image extension
, which enables pasting images out of the clipboard (instead of using the "Attach" button, or instead of dragging and dropping the image).