Well that picture you posted is only 0.0768 megapixel so either:
* It's not a 3.2 megapixel camera
* It's being used in some way that prevents it being set to it's highest resoloution
* the picture was downscaled after being taken
Right click the photo and go to properties. You can see its size is 320x240 pixels. 320 x 240 = 76800 pixels = 0.0768 megapixels. Don't know owt about photobucket myself, but it's resising your images to postage stamps. For internet display you dont really want the whole 3.2MP as that's way bigger than anybody's screen resolution, but something like 800x600 would be good.
Perhaps just upload them from your PC to a gallery on here rather than photobucket if you can't get photobucket to behave. Gallery here resizes them sensibly and makes it easy to insert them into posts.
I was just kidding in my first comment - assumed you must be using a first-gen VGA camera phone or something
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