Here's some good reading to get you started:
http://fairuse.stanford.edu/Copyright_and_Fair_Use_Overview/

Here is a useful collection of copyright info for filmmakers, in comic book (!) format
"Tales from the Public Domain: Bound by Law?"
http://www.law.duke.edu/cspd/comics/

Curious fact: If I type "copyright" into Google I get 5.87 billion hits. I think that's the most hits I've ever seen on any search I've done.

1. How do you know if it has been registered? There is no current mechanism to look up images.

2. If it's not registered, it's protected, but not enforceable in court. Still a potential headache if the original author ever spots the image.

3. Is there a creative commons license on the Picassa images you are interested in? And which Creative Commons license?

Bottom line, if you think it's protected I wouldn't use it because; A. Its's stealing B. You might get caught.

Except for non-sense like wedding videos, I would only use royalty free and appropriately licensed creative commons material.

You don't have to register, but it is suggested if you feel your work may have to be challenged some day.

Ever since the online image submission was set up last year for registering images, many photographers, but still very few of the total, have been getting their images registered. You are allowed to submit any number of "unpublished" (long definition) images of a collection at once. So it's easy to get lots of images registered.

You have little to no court case without the images being registered. However, why test a mad photographer.

What you gain from registering your copyright is the ability to sue for damages. Otherwise, your legal remedies are limited to a court ordered cease and desist.

Google's Picasa website says that only its software is protected by Google copyrights.

Regarding material posted by the public, it says:

"You acknowledge and agree that third parties, including other Google users, may own right, title and interest in and to Content hosted on Picasa Web Albums or otherwise presented to you through Google services, and that this Content may be protected by applicable intellectual property and other laws and treaties, including but not limited to laws governing copyright."

I'm in the process of creating an autobiograpy (no commerce involved, to be posted for a free download or viewing on YouTube, etc.) and had assumed that pictures downloaded from Picasa albums that clearly were posted by tourists (such as those albums with titles, for example, "my trip to India" - invariably with included photos of spouses, kids, etc.) were in the public domain, since they obviously weren't copyrighted, and didn't seem to violate rules by the owner of the subject being photographed (personal images, sites, such as the Eiffel Tower with its night lights turned on, etc.) and had been placed on Picasa with the clear intent of sharing them with the general public.

But now maybe I need to rethink my approach. . .

You bet.

Go to www.iStockphoto.com instead.

Inexpensive and surprisingly useful.

What you gain from registering your copyright is the ability to sue for damages. Otherwise, your legal remedies are limited to a court ordered cease and desist.

You sure about that? The way it was put to me is registered gets you triple-damages, unregistered just gets you actual damages.

If it's not registered, it's protected, but not enforceable in court.

Not quite. Registration only aids, but does not preclude enforcement. With or without registration, copyright belongs to the owner of the image.
Curiously enough, the article appears as almost a plagiarized work from the University of Texas copyright guidelines. I'm sure it's not, as it was written by an attorney, but man....it's so close in flow, wording, and contexts...

Anyone wanting to use any pictures without a specific release is looking for trouble. It doesn't matter where it's posted or how it's 'registered'.

VirginMobile in Australia last year grabbed some photos off the Flickr site and used them in ad campaigns without seeking release. And these were much more "available" than most images, licensed under Creative Commons. But Virgin rightly copped hell:
http://www.theaustralian.news.com.au/story/0,25197,22130223-17061,00.html

Some of the issues discussed here:
http://www.cyberlawcentre.org/unlocking-ip/blog/2007/07/are-you-attributing-or-what.html