Hi Venkat,
When you add an image to WLW, it will resize the image for you. You will need to change the size of the image back to the original size. If you want to have a smaller thumbnail image created, you can keep the image small, but choose the size of the expanded image. Here’s how you would accomplish each of these tasks:
Keep the Image The Same Size
When you first add an image, it will appear small as follows:

This is because WLW has created a thumbnail image as well as a larger image it will show when the user clicks on the image.
To show the full image, click the advanced tab in the properties pane on the right as follows:

Then change the Size dropdown to Original as follows:

Optionally, return to the properties tab and remove the drop shadow that WLW adds by default. Also change the Link to dropdown to None as follows:

Leave Smaller Image, But Make Popup Full Size
If you want to have a thumbnail image, but want the pupup window to remain full sized, you can resize the image as needed.


Then click the Options button in the default tab related to picture properties.

Set the Size property to Original.

Regarding the use of the DNNArticle provider, you can create new article with this provider. It is only the Text/HTML module provider which has the limitation where you can only edit existing Text/HTML modules added to the site.
Hope this helps,
Don