

The currently common older implementation of e2ee in xmpp has the same issue with only the message body being encrypted. There are newer specs of OMEMO that have better metadata protection, but its adoption in xmpp clients has been very slow.
Prosody is more of a sandbox, with Snikket being a preconfigured version of it, but yes running Slidge will be a bit easier with a normal Prosody server.
https://join-lemmy.org/docs/administration/configuration.html
You need to set it to proxy all images.