The popup on clicking Insert Quotes is plain unnecessary.
I think Multi-Quote should work the same way as "Reply" link, that is directly insert the quote in the reply box. On going to a different page, user can click on the "Insert Quotes" button. Clicking it should simply insert all the multiple quotes. The user can simply delete if he doesn't want a quote. Wanting to remove a multiple quote after having clicked on Quote+ is less likely to happen than a user wanting to include all quotes. As a general principle I believe majority should not be inconvenienced for the sake of minority.