I’m used to just setting a featured image if I want it to appear as a thumbnail, etc, for a post. Then if I also want said featured image to be in the post itself, I would click on “add media” and so on.
Currently it appears that after you publish a post, by default the image you set as a featured image is inserted above content. Naturally this isn’t optimal as people will just want to set featured imaged to appear as thumbnail on Recent Posts Plus widget, and only have text in the post. Or people may want to position image within text to their own liking.