13 July 2008: looks like something has changed. The above image uploaded direct from Blogger photo upload icon wasn't animated before. It is now. Looks like Blogger has upgraded.
This is an image uploaded via Photobucket:
This is an image uploaded via Photobucket and centered:
Conclusion: To upload an animated .gif image and for it to remain animated, you must host it with Photobucket. Instruction on how to do it (writing the HTML, getting it centered, etc. will be published later and a link to the post put here.
UPDATE: The instructions for making the above thumbnails are at Make thumbnail with Irfanview. There are other methods. When I have the time, I will test them and make a post giving instructions.
Related post: Animated gif image, Blogger and Photoshop