I only use the HTML editor, so I don't know if this issue applies to the WYSIWYG editor as well...
It seems that, no matter whether I select the "using thumbnail" or "using original" option, the width and height attributes always set to "128" and "96", respectively (which, I assume, is the thumbnail size for a 400x300px original).
I've tried using the various linking options to see if one would post the correct width/height attributes, to no avail.
Not a major problem, as the correct image is SRCed when I opt for "original", and as I always upload photos as 400x300px, I can just correct the width/height attributes.
But, it's still rather annoying. :)
Has anyone else noticed this issue? Am I just doing something wrong?