Being able to incorporate images into the book is very important for some types of book - eg, if you look at the "Philo Vance" detective stories I've posted recently, you'll see that they have all sorts of diagrams in them such as plans of the building where the crime took place, and the books would lose a lot without them.
I don't personally see the need to "flow" text around images as being important - simply being able to put images on the page "between" two paragraphs would suit me fine. BD does support text flow - you can put an image on the left side of the page and have the text carry on to the right of it - but in cases where I've found that in the books I've converted, I've "unflowed" it - ie cut the picture from the text and re-inserted it at the end of the paragraph. On the Reader's small screen, I don't think that "flowed" text look especially good.
Just being able to have:
<paragraph of text>
<Another paragraph of text>
is, however, I think pretty vital!
In reality, because of the size of the Reader's screen, large-ish images do generally end up either at the start of a page, or at the end, or, indeed, occupying a page by themselves, but I certainly think there should be the option of having images in the middle of the page. When I did the "Sherlock Holmes" stories, for example, it was vital that the "Dancing Men" graphics be able to be inserted mid-text.