The media uploader on dashboard doesn't work

Just installed newest version of wordpress and starting a new blog for a cub scout pack. Using Twenty Eleven theme. http://www.scoutsonline.org/pack790 It is impossible to upload pictures using the media uploader on the dashboard. I’m sure I could use html code and force the issue, but the whole point of using wordpress is to allow users who do not have html knowledge to update the website. Can someone help me? I’ve never had this issue at such a basic level – it should just work, and it does not.

In addition, I want the uploader to automatically reduce the size of the picture so that I don’t have problems with uploading in the future. If the user is trying to upload a picture that is over 10MB, then the uploader will automatically reduce the size so it will fit. I’m sure there’s plugins but when I looked for them, there’s a blue zillion. I chose one, but it does not seem to automatically work after I enabled it. Shouldn’t wordpress be more simple and just work?

thanks in advance to any help! I do not wish to sound ungrateful – this is a free tool, I get that – but I’ll admit I am frustrated! I will be so grateful for any advice on what to do.