Yes. To add a profile-picture, go to your own profile-page, click on "Edit Profile" and scroll down to "Image". There you can browse for an image and upload it (by pressing "Edit" at the bottom of the page).
I don't think you can use a picture from the photo-album on your profile-page as a profile-picture, but I'm not sure, since I don't use the photo-album myself.
Could it be possible to enter a function wich makes it possible to read back, while you are typing a post? (just like the eff has) That would make it a lot easier to quote more people, etc.
in september we will introduce first the possibility of 6 different general lay outs of the site according to your own privilege. in october (or maybe also in september) we will introduce the possibilty of pimping your own profile totally in your own style (fonts, lay out etc)