After you click "Manage attachments" a new window will come up. Click "browse" , then go find the photo file in your computer. Click the file and it will display in the browse box. Then click "upload". After it shows as being attached, click "Close this window".
The biggest photo you can post at once is 100KB. If you photo is too large, you will have to use some sort of photo software to resize it and try again.