The Photo Library contains pictures you've synced using iTunes on a computer. If you have not done that, then it should be empty, or nearly so. A little space may be taken by the file structure, and I'd guess that is where your 0.2KB is going.
Photo Stream will only keep the last 1000 pictures, or 30 days. I'm not completely sure how that works out to space in the end, but it puts an absolute cap on how storage will be used on the iPad for that feature. 514 MB (half a GB) could be that cap. For that reason don't use Photo Stream as a permanent way to keep photos on the iPad.
Pictures may end up upside down or sideways when sent if you hold the iPad upside down or sideways when taking the picture. While the iPad stores the orientation data in each photo, not all apps on other computers or devices understand this. So they can look fine on the iPad, but end up elseways elsewhere. To prevent this make sure you are holding the iPad with the power button at the bottom or to your right when taking photos.
If you are not sure how you held the camera, try Editing the picture in Photos. Rotate it, save it, then rotate it back, and save again. In my experience this resets the photo to the viewed orientation in whatever way it needs to look right on other devices.
The smallest size, using Mail, is really quite small. It's going to look blurry on any display much bigger than a phone. Try medium for web viewing, or large if someone is going to want a decent picture. Here are some samples of what Mail does to a picture when you choose a smaller size, depending on the source.
From Screen Shot on iPad 2
Small = 320 x 240
Medium = 640 x 480
Large = 1280 x 960
Actual = 1366 x 1024
From Screen Shot on iPad (3rd gen)
Small = 320 x 240
Medium = 640 x 480
Large = 1366 x 1024
Actual = 2732 x 2048
From iPad (3rd gen) Camera
Small = 320 x 240
Medium = 640 x 478
Large = 1296 x 968
Actual = 2592 x 1936
320 x 240 is very small by todays standers. It's the same as older TV sets (not HD)
You can also copy photos from your iPad using the USB cable connected to your computer. In Windows iPad will mound as a USB drive, and the pictures will be in the DCIM folder, in subfolders. On a Mac you can use the Image Capture app (in the Applications folder) to copy pictures from the Camera Roll to the computer.
Another way that works is to use a photo transfer app.
PhotoSync (no hyphen) is an app you can run on the iPad to transfer photos between iOS devices and a computer. Between devices you need the same app loaded and open. There is also a client for Windows and OS X. It is not necessary, but it does make things easier. Works either on the same wi-fi network or BlueTooth, the last being less reliable and slower. A method of last resort.
There are other photo transfer apps. PhotoSync just happens to be the one I use, and like.
One last thing. If you've been keeping your pictures just on the iPad, you need to start considering how to back them up elsewhere. It's never a good idea to keep important data in just one place. It is doubly a bad thing when that one place is a mobile device, subject to all kinds of extra hazards
Hope that answered all your questions.
Good luck.
