I had to edit a template to change:
clientscript/vbulletin_textedit.js
to
/clientscript/vbulletin_textedit.js
Everything worked fine after that (and having added the code before EVERY "insert link" in the textedit.js file).
Works fine:
http://www.absolutepunk.net/showthread.php?t=199642
There's examples in that thread for those curious how it ends up looking.
I also ended up creating new "button" icon. I've attached it - for anyone that wants to use it.