Isomies wrote
This might seem a bit rude but you do really need to have an understanding of how to accomplish relatively simple tasks such as displaying images in forum posts if you are going to be succeed in installing and configuring DNN.
Is there someone you could ask to help who is familiar with IIS and web apps?
To answer some of your points:
You most definitely do need to make sure the web server is running. You ask if "“Default web site (stopped)”, is this a problem ? " --- Yes it is. Start IIS.
You do not need to edit web.config if you are using the default install options for the database running the system in the dev environment locally.
You will need to ensure the aspnet user has the correct permissions for the folder where DNN is installed.
Hope this helps.
Good luck,
Tim
Hi tim, you dont seem rude at all, thank you for your time and help.I do have a basic understanding of web and computer, for instance i can edit images in fireworks, build web sites in dreamweaver upload sites, css, the last web site i built,severeal search words get it listed in first position in google. (cant do that with my own web site though damm)
when i am trying to install a picture form the tool bar above, 
it is taking me to a browser server not to my desk top where the pictures are for uploading.
I am trying to get IiS running, every time i click in control panel - admin tool - iis - then in the web site drop down it says that web site stopped , when i right click it and press start i get the message "unexpeted error 0x8ffe2740 occcured"
i am trying to put my finger on what is wrong with my set up.
The computer was reformated and windows reinstalled before i set out trying to get this working.
Again Tim, thank you for your time, i did not take it as rude, i am greatful for any advice or help at his time