This is an attempt to save disk space. If you have Microsoft Office installed, you can right click the photo, Open With... Microsoft Office, Picture/Compress Picture, then select Web Page. That usually reduces a photo jpg to about 50kB. Steve's site limits a picture to 128kB.
Or you can use something like Picassa or PhotoBucket to upload the full sized photo to a web site, then embed a link to the uploaded picture in you posting on Steve's site. Here's a sample photo linked using the Picture button (2nd from the left button above):
It's a little cumbersome, but I like the Picassa route - I have all my completed scroll saw work in an album and can share it with whoever is interested.