TL;DR: Mozilla has a new CEO and a new mission: transform Firefox into an AI browser. That has run into some snags, as Firefox users don’t seem that interested in AI. Mozilla is forging ahead, utilizing deceptive patterns (previously known as dark patterns) to nag and annoy people into enabling AI features. You can see this in the introduction of Link Previews, an extremely invasive anti-feature that exists solely to push AI into your experience.
Not a federation issue. Limitation of Lemmy. Lemmy doesn't support link AND image in the same post "header". One or the other.
You can do a custom thumbnail and a link OR you can do an image.
And with either, you can put whatever the hell you want in the post body.
But the "header" (can't really think of a better term, sorry) is image OR link.
I've brought it up to the Lemmy devs that they desparately need to make this limitation clearer, at the very least in the Lemmy UI. They said they need to see an example of a better UI because they couldn't figure it out themselves. Can't make this shit up. Just clear out one when you fill in the other. Red warning message. Anything to make it fucking clearer. It shouldn't be tough, but here we are.