I don't know if image posting is actually a problem with Avelon. I've been using another Lemmy instance these days because I've had problems with posting images, along with other problems, while logged into lemmy.world and while using other apps. It might have to do with the CSAM incidents lately.
Yeah, the app does that to try and fit various different lengths of text on many different phone sizes. Pretty difficult to ensure that it always looks great given all the different settings and screen sizes possible