Massive blank space created when using permalinks

Sorry to bother everyone on here but I am stumped and can’t find the search words to use to find this topic as I am sure someone has had this problem before.

Here is how my blog looks when you visit it: http://www.developingatlanta.com/wordpress/

And here is how it looks when you view by category or permalink:
http://www.developingatlanta.com/wordpress/2008/01/31/glenn-kelman-ate-my-lunch-today-at-breakfast/

Any ideas? My guess is there is an image somewhere that is throwing the format off? but how do i find this mystery image?