I've used IrfanView for several years now, and it does alot of things my high-end photo software can do. It's amazingly fast & easy (especially if you learn keyboard shortcuts). The mathematical algorithm it uses to resize is superior to most editing programs (Lanczos filter). You can even add 3rd party photoshop filters to the program, for special effects, tools, etc.
A 3MB photograph can be reduced to about 100-130k with practically NO humanly visible difference in quality. A 5.5MB picture can be reduced to 250k with very minimal visible difference @ 1600x1200 pixel resolution. That's about a quarter of 1GB for a 22"x17" picture.
I've tried Picasa and at least a hundred other softwares. None of 'em stick in my workflow like IrfanView has.
As far as photo-hosting, I just use my website. I don't know much about that, but I've seen some folks run into trouble because the site they hosted with required a username/password for other people to be able to see. I'm not sure what sites do/don't present this problem, but I think webshots.com is another one that would work well.