Microsoft’s OneNote app was updated to version 2.5.2 for iOS8. Now, you can insert file attachments and printouts stored in the cloud without leaving the app. You will need to install iOS8 and use cloud storage.
“In OneNote for iPad, tap Insert and then choose either File or PDF Printout; in OneNote for iPhone, tap anywhere on a page to bring up the keyboard, then tap the paperclip icon on the command bar above the keyboard. From here, choose your favorite cloud storage service—tap on Location if you don’t see it in the list—and you’ll be able to insert files into your notes!”
The ability to unlock your existing password protected sections in OneNote for iPhone, iPad, and Mac have been added too. “you can do all of those things right from your Apple devices! For example, create your holiday shopping list from your Mac and protect it with a password so nosey friends and family won’t find out what you’re getting them, then open it from your iPhone when you’re at the store.”
With a touch ID-enabled device, “you can now unlock password protected sections with your fingerprint. When you’re entering your password to unlock a section, simply enable the Touch ID switch and you’ll be able to unlock the section with your fingerprint in the future. (Be careful not to forget your password—you’ll need it if you want to change or remove the password or unlock the section from another device.)”
To learn more about the features, you can read the blog post from which many of the quotes above originated.
iPad Notebook 
Hi…I have an iPad with iOS 8 with both onedrive and Google drive installed. I have upgraded to the latest version of onenote and have an office365 subscription. When I try and add an attachment to onenote on the iPad, the only cloud service I can access is icloud and I do not see the location link as advised in your post. Any idea why? Many thanks.
According to the directions, tap Insert > File to browse from iCloud and other file storage apps. When you tap that, you should see a window that has iCloud at the center and to the left “Locations.” Tap on locations and you will see a drop down to select iCloud or More … Tap More… and see if you find what you are looking for.
You may want to contact OneNote support.
Thanks for the prompt response. Yes, I have done all that but all I see at the top of the displayed dialog is “iCloud” and “Done”, there is no “Locations” link. Very strange. Yes, I will contact OneNote Support. Thanks again.
I have the same issue, has anyone ever found out what to do about this.
Sorry what I meant was the same issue Danny highlighted.