When you look at the HTML code of the image in your post it will look like this:
<a href="http://blogspot.com/v4cahi8WcKQ/s1600/imagename.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;">
<img border="0" height="640" n4="true" src="http://blogspot.com/ /v4cahi8WcKQ/s1600/imagename.jpg" width="532" /></a>
The first statement determines where you will go when you click on the image. The second statement determines how large the image will be when shown in your blog post.
To change the size of the image displayed in your post, adjust the blue numbers, or add them to the HTML code when they are not there.
Make sure you're always downsizing an image, otherwise you'll loose resolution. To be sure you can first selected 'original size' by clicking on the image, and then add the desired height and width statements into the HTML code yourself.
Some upload sites like Blogger's Picasa use the red numbers, which are the maximum size of the image when it is loaded into you post. You can change this number in the second statement to make the image appear smaller; if the orientation of the image is landscape then the number will correspond to the width, in case of a portrait he number will correspond to the height. When you do this you can remove the blue statements. To remove all limitation use s0 (s zero) (make sure to remove the blue numbers first by selecting 'original size').
next episode: Maude