"The submitted avatar is 425 pixels wide and 334 pixels high. Avatars must be at least 20 pixels wide and 20 pixels high, but no larger than 90 pixels wide and 90 pixels high."
That might be your problem, save the picture and resize it.
EDIT: If your still having problems, just:
CLICK ME (I have set the details on pixels so all you have to do is search an image, take the final URL and paste it into the off-site URL box =]ANOTHER SOLUTION:
1) goto
here2) look for the image you want
3) click the image
4) now on the right hand side, look for "view image full size"
this should take you to the real page, in other words the final URL.
you'll know it's the final URL because
1: it won't have a grey backround
2: It will just be the image
3: it will end in a picture format (the URL) so .jpg, .png, ETC.
5) paste the final URL into the avatar offsite box
Tats approved