For what you want to do, you would need to use Link, but that would require the user to submit their details using “Edit My Directory Entry” admin profile page. Form will have an update so it integrates with Link to allow frontend editing later this year. So requiring the edits in the admin would be temporary.
You wouldn’t need to use a role editor for permissions, that is built into Connections. It on the Connections : Roles admin page. You would select Add Entry and Edit Entry under the roles your users would be registered with. With the capabilities set like this, you would not be required to moderate the submissions.
I hope that helps clear things up a little.
As for the rich text editor. You could change the code in Connections which limits the editing tools that are available. The image insertion is remove only because that allows access to the WordPress Image library.