Attaching images into Notes for iCloud Web
As per the current implementation, it is not possible to attach images and any other file/media supported by Notes app on macOS/iOS via the iCloud Web client.

There is no control in the Notes Web app UI to attach images/supported files, neither does dragging and dropping image(s) work.

Although the lack of feature is not directly mentioned, the help document for Notes for iCloud Web (accessed by tapping the ? in the header area) makes a cursory remark about requiring macOS/iOS device for attaching items.