When you enter your message here, look at the top right of the message window, for a symbol that looks like a picture frame. Click that, and paste the url from tiny pic.
The advantage is that tinypic automatically resizes the file, and there’s a larger size allowed, to begin with.
I just upload my photos to The Gimp (a free imitation of Photoshop). There you can resize the image, and then save it as a compressed file. I usually resize to 500 pixels wide. When I save the file I uncheck the “save thumbnail” box under advanced options. I usually save the file as a jpg and compress it 65%. Once you do it a few times the process if pretty fast. The resulting file sizes are around 20 to 30 kbytes.