Featured images dimensions are critical for display.
Suburbia description notes http://theme.wordpress.com/themes/suburbia/
live demo site http://suburbiademo.wordpress.com/
On the main page, Suburbia doesn't display regularly inserted images. Regularly inserted images only display when a post is viewed on its own page - not on the front page.
To have front page image display you need to set a featured image to each post and make each post a sticky post. Note that the size of the featured image does matter. Featured image sizes are critical to display. The featured image works best with images at least 350 by 248 (width, height) - smaller images will not work.
Setting a Featured Image > http://en.support.wordpress.com/featured-images/#setting-a-featured-image
Sticky posts > http://en.support.wordpress.com/posts/post-visibility/#sticky-posts
If you don’t see the Featured Image module on your Add New or Edit Post page, please make sure you’ve selected Featured Image in your Screen Options. http://en.support.wordpress.com/screen-options
The "S" is the header image that you can replace with one of your own. The custom header image is 155 by 155 (width, height). That header image can be replaced here > Appearance > Header.
You set the number of post you want to display on the front page here > Settings > Reading
You set-up widgets here > Appearance > Widgets