How in the world did that go missing?
It's exactly the same code as for adding the button in quickedit. zipfile updated.
And for your second question:
You can use HTML-Code in phrases. Search photo_popup_insert phrase and wrap <span style="color: XYZ">Insert</span> around the text. This way, you can change size, color, weight, style - whatever you can do to text by ways of css.