UPDATE:function to extract image as thumbnail from a post

This method is depreciated in favor of the wordpress 2.9 thumbnail functionality.   Here is a good tutorial how to implement it.

When you want to add an image to your lists of posts you can use this function (paste it into functions.php):

function postimage($size=medium) {
if ( $images = get_children(array(
‘post_parent’ => get_the_ID(),
‘post_type’ => ‘attachment’,
‘numberposts’ => 1,
‘post_mime_type’ => ‘image’,)))
{
foreach( $images as $image ) {
$attachmenturl=wp_get_attachment_url($image->ID);
$attachmentimage=wp_get_attachment_image( $image->ID, $size );
$imagelink=get_permalink($image->post_parent);

echo ‘<a href=”‘.$imagelink.’”>’.$attachmentimage.apply_filters(‘the_title’, $parent->post_title).’</a>’;
}
}
return true;
}