Tim,
To post a picture, use the attachment option within your posts. Once you click the attachment icon, it'll open an interface that allows you to upload as many images to the post as you want. It will auto-generate the thumb for you, which will link to the full size image. If you have multiple images in the post, it will create a slideshow when you click one of the thumbs that it creates.
I've attached some of Larry Newton's gold engraved knives for an example of attachments. It doesn't show the technique you're talking about, but they're cool looking engraved pieces. We just finished a new website for him this week.
http://www.larrynewtonknives.com
Also, you can click your username and create a personal photo gallery. They'll rotate through the images on the homepage for all the world to see, and you can link them to posts, other websites, etc. (PS - post some of your work for these guys to see! you do excellent work yourself!!!)
Let me know if you need help!
Alex