When you reply or start a thread, there's a little paper clip next to the smiley face. Click the paper clip. That pops up a window where you can attach a pic or point to a url. If you attach a pic, it has to be resized to no more than 200KB. You can resize at
Photo editor | PicMonkey: Free Online Photo Editing or any other photo site. You can probably do it on Picasa too. But I haven't used Picasa, so I don't know exactly how.