Cynthia
The problems with running a referenced library are as follows:
1. Import and deleting pics are more complex procedures
2. You cannot move or rename the files on your system or iPhoto will lose track of them
3. Most importantly, migrating to a new disk or computer can be much more complex.
The real problem is when you need to move your files to an external disk (all those big files, for instance), and thereafter go an migrate to a new machine.
iPhoto tracks your files by aliases. In your referenced library there are aliases to your actual files. Move your photos and iPhoto cannot find them. Then you need to resolve those aliases.
In a worst case scenario, you need to resolve all of them, for every pic.
There are other advantages to letting iPhoto manage the files - apart from the inverse of 1,2 and 3 above. Backing up is easy. Simply back up the iPhoto Library and get Pics, Albums, metadata the whole lot at one go. Migrating is easy. It's all easy.
Some folks feel that if they keep their own file structure it will be easier to find the files: There are many, many ways to access your files in iPhoto:
For 10.5 users: You can use any Open / Attach / Browse dialogue. On the left there's a Media heading, your pics can be accessed there. Apple-Click for selecting multiple pics.
To upload to a site that does not have an iPhoto Export Plug-in the recommended way is to Select the Pic in the iPhoto Window and go File -> Export and export the pic to the desktop, then upload from there. After the upload you can trash the pic on the desktop. It's only a copy and your original is safe in iPhoto.
This is also true for emailing with Web-based services. If you're using Gmail you can use
THIS
If you use Apple's Mail, Entourage, AOL or Eudora you can email from within iPhoto.
If you use a Cocoa-based Browser such as Safari, you can drag the pics from the iPhoto Window to the Attach window in the browser.
Or, if you want to access the files with iPhoto not running, then create a Media Browser using Automator (takes about 10 seconds) or use
THIS
Other options include:
1. *Drag and Drop*: Drag a photo from the iPhoto Window to the desktop, there iPhoto will make a full-sized copy of the pic.
2. *File -> Export*: Select the files in the iPhoto Window and go File -> Export. The dialogue will give you various options, including altering the format, naming the files and changing the size. Again, producing a copy.
3. *Show File*: Right- (or Control-) Click on a pic and in the resulting dialogue choose 'Show File'. A Finder window will pop open with the file already selected.
As to the files you have on your Mac: once you have imported them, and feel comfortable and trust iPhoto the obvious thing to do is to trash them. But you don't have to do that straight away. You can wait until your happy to do it.
Mind you - no matter what system you settle on - remember it's vital to have a good back up.
Always allowing for personal preference, I've yet to see a good reason to run iPhoto in referenced mode unless you're using two photo organisers. But I can see a lot of potential issues from doing it.
My 2 cents.
Regards
TD