Piper, are you trying to show a photo hosted on another site, or from your album?
Just right click the image and copy its address, in this case, it is http://pipesmagazine.com/wp-content/uploads/2009/12/craigs-card-01.jpg
So I hit the IMG button right above where I am typing this response, and a window pops up where I will paste the address.
there you go!
What might be throwing you off is when the IMG window comes up, http:/ is already there. Just erase that and paste in your address. Otherwise you get http:/http:/www.pipe.com/pipe.jpg which doesn't work.
I think I hear John coming with the tutorial post...