This is because your iPhoto library is a bundle rather than a single file, and the displayed Finder window isn't smart enough to treat it as such. If you go into /Users/~/Photos, there should still be an "iPhoto Library" bundle, and if you right-click on it, you can choose "Show Contents" or some similarly-worded entry, and it will give you a new Finder window with the contents displayed.
Another, quicker, method is to open the file from within iPhoto. Here, the context menu includes a "Reveal in Finder" or "Show in Finder" option (again, not sure of the wording). Choosing this will let you copy the photo to an easily accessible spot like the Desktop, where you can upload it to the website.
If you're uploading large batches of photos, check the host to see if they have a plug-in for iPhoto. I know for certain that Facebook and Google's Picasa have plug-ins that are fairly robust.