Here is a video on embedding images in discussion replies in the Canvas mobile app
To embed an image in a Discussion reply, please first open up the course in your Canvas app and go to the Discussion you are replying to.
Press Reply to the post you are replying to.
Press the large empty white space to begin editing, then click the embed images button.
You will then have the choice of either Take Photo or Choose Photo From Gallery, choosing a photo will open up your phone's default photo gallery and let you select a picture to embed, taking a photo will open up your phone's camera and let you take a picture to embed.