Well the text handling did what I had hoped for. I was able indent the first line, no problems (someone has since advised that all I need to do in Writer is hit the spacebar five times). Paragraph indentation worked well, but will I use it ? Not sure. Inserting a single image was not really a problem, except for the sizing issue. I understand that the image style I chose was the problem with space. I chose a random style that had a part mirror image at the bottom. What it does is creates another image, inverted and fades it. So basically it was one image on top of the other. There also seemed to be no way to add tags easily. Writer does have a plugin, which does it in a round about way. It’s not perfect, but it’s there. I miss the Writer preview function and the ability to write in the blog format, which is a really useful feature.
I also found that I could upload the whole document to my WordPress blog, but I usually cross-post to Blogger, which did not seem to allow me to use images. Writer does not have this problem. So, for the immediate future, it looks like I will stick to Writer.