We've being using Flickr as our graphic host for Enlighten-NewJersey and hadn't noticed the picture icon on the Blogger compose screen is operational until just now. So if you use Blogger you might want to give this new feature a try.
We have a few Carnival of the New Jersey Bloggers graphics we want to post and will give Blogger Images a try later today.
People complain about Blogger, but it's free and the Blogger team seems to be working on additional features and improving reliability of the platform all the time. If you have a problem with the Blogger system, you're pretty much on your own - but what the heck, our blog hasn't cost us a single dime.