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I'm not sure of what you mean by "the new photo widget"? The widgets provided for image placement are the picture widget, the picture gallery, Flickr Gallery, Smug Mug Gallery and the text widget with it's own image placement facility. You can find tutorials for these under Adding and editing content. Group 18. Pictures
To rotate an image you need to do this to the image before uploading into the File Manager. Something like Paint has a rotate function and should do the trick. Your images can be manipulated in situ with the resident sitebuilder image editing facility by Aviary. Unfortunately Aviary may have unpredictable effects in the sitebuilder and many users have used image editors outside the sitebuilder for this reason.