OK, here's a couple of things I did to work around this:
I installed the Image Caption plugin (http://wordpress.org/extend/plugins/image-caption/) This grabs captions for images from the image title. Works nicely.
Then I changed the priority for the hooks in Textile2.php to something really high to make it get executed last:
add_filter('the_content', array(&$this, 'do_textile'), 600000000);
add_filter('the_excerpt', array(&$this, 'do_textile'), 600000000);
add_filter('comment_text', array(&$this, 'do_textile'), 600000000);
add_filter('the_content_rss', array(&$this, 'do_textile'), 600000000);
//add_filter('the_excerpt_rss', 'do_textile', 600000000);
And that's it. Now I have links, bold, italics, etc in my images. For example this is in one of my image titles and it has bold, italics, and a link using textile formatting (asterisk, underscore, and quotes around link titles):
*John Beasley Greene,* _Tombeau de la chrétienne [Tomb of the Christian Woman],_ 1856; albumenized salt print; 10 3/8 in. x 12 1/16 in. (26.35 cm x 30.64 cm); Collection "SFMOMA":http://sfmoma.org, Accessions Committee Fund purchase