The way we have it set up, if a user uses the "Manage Attachments" function rather than the "Insert Image" button on the toolbar, then it must be inserted inline, and if so, does not double display.
We use a lot of images of graphs of functions and other math related stuff, and for us thumbnailing of images is just annoying (I find it annoying anywhere...just show me the image already, don't make me click it to see it!).