Adding hyperlink to images already on the web doesn't work

Adding hyperlink to images already on the web doesn't work

This looks like a bug for sure.

REPRO:
Click the "Insert/Modify Image" button on the toolbar.
Paste in an URL of an image already on the web, e.g. http://www-ucdmag.ucdavis.edu/su02/graphics/watermelon.jpg
Click OK.

OBSERVED:
Image is broken.

EXPECTED:
Image should display properly. The only way I've found around this is to drag, copy-and-paste an image from the source page itself into Zoho Writer.

This happens in Firefox 1.5.0.2.