Great I got the ratio right.
But the ads leave a small yellow space at the top and overlap the ads below them.Even if I move an image in between the ads, the ad will still have that yellow space above the ad and overlap the image. How can I get them to move up or stay in the space?
I would need to see this in action on your site to be able to help you with some custom CSS code that might fix this.
Also, can I decrease the space on the left side of the posts so the posts are more right aligned and I have more space?
In which specific view do you want to do reduce the space "on the left side of posts"? Maybe you could you take a screenshot and add an arrow to point to exactly where you mean?
Here's a guide on how to make a screenshot, if you're not sure: http://en.support.wordpress.com/make-a-screenshot/
You can upload the screenshot - in a graphic format like JPG, PNG, or PDF - in your Media Library, and provide a link so I can see it, or upload it with a service like Imgur.