You can add attachments to posts only if you register on the site and are logged into WordPress when you post. There should be a login/register box in the column to the right, and then when you are posting the attachments button will appear above the submit button.
Good question – I didn’t know that until just now when I clicked around trying to figure it out. I think they do that to try to prevent spammers from uploading malicious files.
That is one of those things which is never really quite defined. I generally look at it as being from whatever the most recent high was before the decline. If anyone knows if there is a more precise definition, please share.