so here are the steps I went through to post a picture....if there's a short cut please let me know
1.log on
2.create content
3.personal blog
4. title etc.
5. when you get to the "body" block you have to type in enough to allow the thing to post and you must position your cursor where you want the photo to show up
6.go to "attachment" and "browse"
7. find your photo on your computer or drive - photo needs to be sized first as follows or it will not insert.
    a) pixel width not more than 700 pixels, try to keep depth of image reasonably shallow so photo showw up as a banner and doesn't suck up the entire home page.  If possible and it does't cripple the photo info.  Go big if needed.
    b) KB total no > 400 - JPEGS ok  GIFs are fine and smaller files than JPEGs
8.hit attach - image is uploaded to Realneo server,
9. now, below the attach button,  you have an active URL link to click on to get the url of your photo which now resides on the realneo server.
10. copy this URL link and paste it into the box that comes up when you click on "insert image"(this is one of the icon choices at the bottom of "body" - it looks like a green tree
11.an icon for a photo  should appear wherever you placed your cursor in the "body" box
12.now it's time to submit and you have to refresh realneo to see what you have wrought...if you don't like it, not to worry, you can hit edit and scroll down to the bottom of the page and delete the image ..
13. you can insert numerous images into one blog post. 
Hopefully I didn't omit any steps..
cheers
martha
p.s. hopefully the experts will correct this and then position it under "directions" for contributors

You can insert images into someone else's comments by following the above directions, posting to you own blog and unclicking "promoted to front page" .  You must size the image narrower - say 500 pixes - for the comments box because they are narrower than blog boxes.
 Upload the image to your blog which puts the image on the server.
Then copy the assigned url and past that URL in via the "insert image" icon into the comment box.
Submit comment and the image will appear in the comment.
THis is easier with the newer Drupal modules.

Good luck.