Ok....for starters I get confused if there is too much writing in directions so I will try and make it as clear as possible.
1. You need to change your blog template.
a. go to Dashboard
b.click on Layouts
c. click on Pick new template
d. choose Minima Stretch
e. click Save
Every picture you post to Blogger is stored in Picassa web album. When you upload a photo for a post it is automatically stored in Picassa.
In a separate window open up the Picassa link. This should show all your photos that you have uploaded to blogger.
2. Select New Post
a. up load a photo like you normally would, but do not add it to the new post. You know how they upload to the little window and then you highlight it in yellow to add it to the post. Well don't add it to the post.
b. switch screens to picassa.
c. the photos you just uploaded will be there.
d. click on the photo you want to add to the blog. It will open up real big. On the right hand side you will see a menu of items.
e. Click on Links to this photo
f. select size of photo. This will change the embedded image information.
g. click on embedded image. the information will then be highlighted. Right click to copy the information.
Now switch screens back to blogger where you are typing you new post.
a.select Edit HTML
b. right click on the screen and click Paste
c. Your enlarged photo information is now in the post . If you select preview you can see the enlarged photo. Close the preview window. Select compose and start typing you blog.
What is REALLY nice about doing it this way is when you add your photos it places them one after another, in order.
Simply Joyful Photos has taken screen snapshots if you need some visual help.
Hope this helps. I am so excited that I finally figured it out. Good Luck!