Okay, Michele, there IS a setting to allow direct uploads to posts and I've turned it on, so you'll be good to go if there's a next time. It only allows one attachment per post, though, so in this case you'd have to combine the three pix. I've done that and am attaching it.
Yes, your settings are exactly what Yahoo says they're supposed to be. Am I correct in assuming that this account works fine for sending from other computers and the problem is specific to the MacBook? Does it get as far as giving you a password prompt?
By the way, while we're trying to figure out the solution to the problem, you can always use the Yahoo POP account with a different SMTP server. They don't have to match, so you can use, say, your .Mac/MobileMe or Comcast SMTP server in the meantime.