I've grown to dislike iPhoto for one feature.  Overall it's a really nice application with a lot going for it, useful features, the ability to create picture books and have them printed automagically, etc.  But the critical flaw is that your pictures have to be encased in its proprietary storage system.   On importing photos into iPhoto it makes a copy of each image file in its own directory hierarchy and any edits it does on the images are on that copy.  You are expected to delete your copy and only use the copy which iPhoto has.