I have thought about this. I don't personally know how to implement it, but I thought about it. Another forum on which I am a member still uses UBB.classic 6.7.3(!) and they implemented smileys and file upload with the quick reply, but the guy who did it is no longer around.
Wow, I'm always amazed to see UBB.Classic forums kicking around; the last version came out in like 2005. Unfortunately, their users are going to have a horrible experience with any sort of mobile browser (and since mobile makes up for a huge chunk of modern traffic, they'll be missing out on a lot of potential users accessing their content).
I would highly advise against making the Quick Reply a full fledged editor; mobile users aren't going to want to chew through their data plan on sites that have features that'll add bulk to their mobile browsing experience.