Add a "Freestyle" section and click on the image icon (looks like a flower). The image selector will pop up, click "Go" to see all your uploaded pictures, or type in all or part of the file name to quickly find the picture you want.

Once the image is in a freestyle section, you can just click on the image to select a different picture.

Removing an image without deleting the section
Click on the picture to pop up the picture selector, click on "No Picture" at the top.

Graphics, e.g. logos, buttons, arrows, icons etc., are best in GIF format.

Note that JPEG images can be resized within the website editor, GIF images cannot be resized.

When your site is published, your original image is copied and properly resized to fit the space allocated.

The quality of the published images is set by the "preferences" control (next to the publish control). The quality setting can be changed to achieve a balance between file size and quality. Remember to republish after changing the quality setting. The preferences control will not affect the quality of the image shown in the designer.

For best results, always upload JPEG images at a larger size than you will ever need on your website.

To give you a feel for pixels

JPEG quality
Copying JPEG images is like making photocopies of photocopies, each copy loses some detail. For this reason, if you manipulate your pictures, always start with the original image and make sure you save it at maximum quality.

Resizing images
To resize, make sure "Preview mode" is off, and just drag on the border of the picture. You can "fine tune" the dimensions in the popup box before saving.