--- You wrote:
If you resize and tweak a .JPG you will get generation loss every time you 
edit.
--- end of quote ---
This is true but not of great consequence for noncritical images, especially if
you save medium quality or better.  Try resaving a jpeg after a small
modification.  Try it ten times and see if you can see much degredation on the
last version.   Few of us edit and resave an image enough times to have a
problem.  

For a 2mp image, you'll do fine to save and resize in jpeg.  Not to worry.

If you can get used to Photoshop you'll come to love it.  The practical
operations you'll need are very simple once you figure out where and what they
are.   The power is there if you realize you need it.   It is one of the most
wonderful programs ever designed.

Meanwhile, there a dozens of programs that come with the various brand name
cameras.  Olympus has Camedia Master,  Minolta has one I'm familiar with.  The
new one that comes with the HP cameras gets very good reviews.   All are
designed to do the simple operations in an intuative way.  Epson supplies a
program with the newer printers that can do some of the things you need too. 
Some of these may be downloadable from the manufacturers sites.

If you are using osX, iPhoto may be all you need.  I don't use it so I can't
say.

Or you could try Graphic Converter, a shareware program with considerable power
for simple image manipulation.  It's strength is that it can convert anything to
anything else (formats, that is.)  It's easy to find on the web.

By the way, I bought the cheapest 2 mp camera I could find a year and a half
ago.  It was an HP 315 and, despite having NO features, it takes wonderful
pictures, great color,  fine fill flash etc.  I have taken over 6 thousand
images with it(the camera keeps count... most are of my young daughter.)  I have
upgraded for better resolution and flexibility, but I still enjoy using that
basic, slide it in your pocket and bang it around 2mp camera.

Enjoy.

Rich

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