You set the size of images here: Settings>Media Settings in you Admin panel. There are also many plugins to manipulate images automatically. Take a look at Viva Zoom.
You may edit your CSS. Simply paste the following in your style.css file: .post img { max-width: 500px; /* Adjust this value according to your content area size*/ height: auto; }
Next Gen Gallery has an option to re-size the images or thumbnails in desired folders (gallery) you uploaded them to. It's not while uploading, but it's close enough.