Many problems with images, many questions

I am in the process of moving my blog from wordpress.com to a self hosted blog.
I’m building the site in a test environment before it goes live using the Thesis theme, and I’m running into a lot of problems with my images.

1.If I add the photo in into the body of the post, it does not automatically generate a thumbnail for the teasers. There is no photo at all on the front page of the site for these posts in the Teasers.

2.If I put the image into the Post Image section, the thumbnail image for the teasers is missing (there is a box, but it is blank).

3. I know I can create a separate Thumbnail image and load that, but I know that it should automatically generate one too and that’s not happening. What else can I do?

4. Do I have to go back and resize all my photos? Most were loaded as larger than column width because wp.com automatically resizes them. Those images are now full size in the post and even if I go back into the image editor and scale them down, it does not work.

5. Finally is there a way to get 2 small images on the same line? Even if I place them side by side in the post, they show up on two lines.

Thanks!