You are inserting your images at "large" which you apparently have set at 1024px wide at settings > media. You can't insert a 1024px wide image into a posting area that has only 500px wide.
Insert your images at "full" and the system will automatically make them as wide as it can for your particular theme.
And go to settings > media and set the "large" size somewhere between medium and 500px.
On all the existing images, you will either have to edit them and adjust the size down by % or you will have to reinsert them all.
On another note: I'm on a wireless internet service and your site too well over 5 minutes to load due to all the images you have on your main page. If I was just dropping buy to have a look, I would not wait for your page to load, I would simply go elsewhere.
Go to settings > reading and set your site to show at most 2 posts per page. Broadband penetration in the US (broadband being over 256kbps - which is very slow) is only 27%. That means that 73% of us out there would likely not look wait around to at your site.