gistfile1.js

//first off, get the Base64 image value from the Web API method
$.ajax({
	url: "https://" + window.location.host + "/api/values?path=" + url
}).done(function (data) {
	//data represents the Base64 value of the image
	if (data != null) {
		if (data.length > 0) {
			var imageOXmlTemplate;
			var templateRequest = new XMLHttpRequest();
			var base64;
		
		    //Get the Open XML image snippet
			templateRequest.open('GET', '/Scripts/App/Templates/Image.xml', false);
			templateRequest.send();

			if (templateRequest.status === 200) {
				imageOXmlTemplate = myOOXMLRequest.responseText;
				//Save the Base64 value in a local variable (after removing the content type prefix)
				base64 = (data.substr(data.indexOf(',') + 1));							
			}
			
			/*
			...
			
			Here you would update the snippet, with a find and replace using the file type (PNG, JPEG etc..).
			Maybe something like...
			
				imageOXmlTemplate = imageOXmlTemplate.replace(/{format}/g, url.substr(url.lastIndexOf('.') + 1));
			
			*/
			
			Office.context.document.setSelectedDataAsync(
				imageOXmlTemplate.replace(
					'{Base64}',
					base64
				),
				{ coercionType: "ooxml" },
				function (asyncResult) {
					if (asyncResult.status == "failed") {
						//maybe do something?
						//asyncResult.error.message;
					} else {
					    //you should be able to see the image in your document   
					}
					}
			});
		}
	}
});