If I were designing it, I would say: "you can have images, but they always display as a 'block element', with nothing to either side. No worries about wrapping text; no background images under other elements, etc." I think that keeps the spirit of simplicity.
It's text. The client displays that text and renders links, headings, etc, however it wishes. If it really wants to, it could just not format them at all. There's a gemini client made for plan9's acme text editor that doesn't render links, and instead displays them verbatim, because the plan9 plumber can handle the hyperlinking aspect. All of that is eye candy and fluff.
If a client finds a link to an image, it can in-line it if it wants. If you wrote a client, when it found a link to an image, it would in-line it "with nothing to either side." That's not something that has to be specced.
Same with how headers are displayed (maybe i want folding or something), whether an ToC is displayed, colours, fonts, etc.
The point is that the user can decide all this stuff, without having to hack it around the author's own styles and scripts.
Technical paper is what I was thinking about there. Furthermore, since Gemini apparently lacks support for mathematical notation images would be necessary for such even if the paper doesn't intrinsically contain non-textual images (e.g. pictures, charts, or graphs, which are common though not universal).
I can even understand why they did it. To keep the doc format very simple.
I hope that more clients will add unique rendering features that will turn this drawback on it's head. It could be in-line rendering or a gallery-like feature.
I know it is an idealogical choice to only have text, but being able to embed standard image formats (on a totally plain, non fancy way) would increase the utility of this hugely. They mention blogs and tutorials and recipes here - those would benefit hugely from having simple inline images within the body of the text, just like you expect in a newspaper etc.
I guess I am not the target market then.