It turns out there was a problem with the file version of the update of the Community Server MetaBlog implementation that was available on Robert McLaws's website, but I believe I have fixed the issues.
If you see my head, then the newMediaObject implementation worked and I can nuke my Live Writer -> FTP -> FolderShare -> Community Server image upload hack and replace it with Live Writer -> Community Server. I know Margot will definitely like that.
Update: hitting the MetaBlog.ashx file now shows that the newMediaObject method is now available, but Windows Live Writer continues to complain when I insert an image.