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query_posts('showposts=5');
  while(have_posts()) :
    the_post();
    $images = get_children(array(
      'post_parent' => get_the_id(),
      'post_type' => 'attachment',
      'post_mime_type' => 'image',
      'orderby' => 'ID',
      'order' => 'ASC',
      'numberposts' => 1
    ));
    foreach($images as $id => $image){
      echo wp_get_attachment_image($id);
      break;
    }
    echo '<a href="' . get_permalink() . '">' . get_the_title() . '</a>';
  endwhile;
wp_reset_query();

style.css:

.hentry .title a, .hentry .title span {
border-bottom:3px dotted #FF9933 !important; // solid
/* border-bottom:3px double #FF9933 !important; // double */
/* border-bottom:none !important; // no line */
}

Your DOM elements have vartical margin and padding.

Change this:

h2.pagetitle {
margin:0 0 5px;
padding:8px 8px 8px 15px;
}

#content .postcontent {
padding:15px 15px 0;
}

To this:

h2.pagetitle {
margin:0;
padding:8px 8px 0 15px;
}

#content .postcontent {
padding:0 15px;
}

Then, a large space will disappear.

the_content('Read More'); and write quick tag ‘<!–more–>’ in your post.
See Customizing the Read More

For example, below rules worked fine.

#content{width:960px !important;}
#body{width:650px !important;}

BUT ‘body.jpg’, the background image of #content-container is still narrow. So you had better replace it with the wider background image or hide background.

<?php
query_posts('tag=page');
if(have_posts()) :
  while(have_posts()) :
    the_post();
    ?>
    <a href="<?php the_permalink(); ?>"><?php the_title(); ?></a>
    <?php
  endwhile;
else :
  ?>
  <p>No posts.</p>
  <?php
endif;
wp_reset_query();
?>

Add below rule into your style.css.
.twtr-hd, .twtr-ft{display:none;}

Below code will work fine for you.

<?php
query_posts($query_string . '&cat=1'); // Services
  if ( have_posts() ) : while ( have_posts() ) : the_post();
    /* do stuff */
  endwhile; endif;
wp_reset_query();

query_posts($query_string . '&cat=2'); // Publications
  if ( have_posts() ) : while ( have_posts() ) : the_post();
    /* do stuff */
  endwhile; endif;
wp_reset_query();
?>

For example,
1 as category ID for “Services” and 2 as category ID for “Publications”.