Under Posts or Excerpts, I set my settings as below. However, all images in the post disappeared. Second, when there's some post displays [...], but [...] is not clickable
Posts or excerpts on HOME page? (i selected excerpt)
Show the first X posts on HOME page as full posts? (i left blank)
The rest of the options are set to be excerpt

Those are default Wordpress excerpts that Atahualpa is using and they get their tags stripped by Wordpress by default. You would have to set to "Full Posts" to change that or use a plugin http://wordpress.org/extend/plugins/advanced-excerpt/

I will look into it. Thanks much!