EDIT: Just looked at picture and seems you have a real fireplace, that's great. You'll still want a real flue to get past the smoke chamber, up into the flue, and to the cap. A flexible flue liner will allow you to just remove the damper door and not hack up the fireplace. There are many types of wood inserts but I'd still consider a good stove that will be more versatile and heat better.
For the flue liner and/or insert checkout Rockford Chimney Supply. They are great people to work with, will do custom/made to order, and are USA and lifetime transferable warranty.