Personally, I never bother with thumbnails myself, but then, I'm lazy, and Corel hates my computer. Thus ...
Right, thumbnails. For thumbnails you need a good art program, like Photoshop or Corel Photopaint. They let you shrink your image down to the dimensions you want. Mind, most of the time, they just crop off most of the picture, and you're left with only one detail from it.
For resizing the images themselves, you can use the HEIGHT/WIDTH HTML tags to give them the dimensions you want in pixels. You do have to make sure the dimensions you pick correspond to the pic's own, though, or you might end up with a squashed monster.
Aigh, Cassy's hand hurts. She's going to stop now.