The editor's built-in image manager does not have support for the required workflows (e.g. it cannot show if an image is aproved or not), which means that end users might get confused why their images are disappearing from the editor content when they publish. We actually received a number of complaints about this in the past, which is why we decided to make the auto-approval feature. It is actually in the MOSS editor file browser content provider, which is used in all file dialogs (image, document, media, etc.). We do not plan to return to the old behavior in future versions of the MOSS RadEditor.
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