When you first take a screenshot from the game, they are by default saved as BMPs. Make sure you resave the screenshots as JPGs, or the file will be too large. Once you have saved it as a JPG, you need a site to host the picture. I have been using Imageshack since I got the game.
http://reg.imageshack.us/
Images have to be less than 1MB. To upload the image, click Browse. Locate it on your harddrive. Once it is uploaded, you will be given some links you can choose. You can choose between direct links to the image or thumbnails. I use thumbnails alot when the image might be too big to post it inline with the message.