Some issues though around using a remote picture service and resizing photos IIRC is that if over time you remove your account from the site - the SOTDs end up with file not found blank images. Also, the larger sizes can cause the page to go out of alignment- at least that's what I remember reading here before...
That is correct. You have to leave them where you uploaded.
I use Photobucket which works for me. I am sure other site's like Richard's Photoscape work well.