I use ZEN photo.
I have all my photos stored by year on my NAS (synology CS407) at home. I have written an extremely simple script that constantly synchronizes between my NAS and my site via ftp. (in that way sychronizing photos happens automatically, unattended and I only need to put new photos in the correct dir and never ever even have to think any more of "putting" them somewhere). The script automatically checks for changes so if I edit a photo from a laptop it automatically updates it on the server on the next run.
For Zen photo some wp plugins exist to let the photos be embedded in your post. An additional bonus is that zen photo is (ofcourse) also a seperate appliation to log into and only see images.
Additional bonus is that at home the \photo folder on the cs407 can also be used to edit photos from various laptops e.g. with picasa or from another laptop with xara and can be used to e.g. stream the photos to kiss player or xbox to the tv etc...
things are often resolved by just putting an extra layer of software/hardware in between.