If we can forget about Picasa for a moment, there are two ways of sending and receiving ordinary e-mails. You can either use 'webmail' (for which you use your internet browser, such as Internet Explorer) or 'SMTP/POP3' mail (for which you use an e-mail client, such as Outlook Express).
Your reference to IE6 suggests to me that you normally use webmail. However, when you click on the 'send by e-mail' button, in any program (including Picasa), the mail is sent by the SMTP/POP3 method, which means that the program used is your default e-mail client (which is probably
Outlook Express) and
not Internet Explorer.
It seems that the account settings in Outlook Express are wrongly configured. If I can assume that your ISP really is NTL World, then you can read how to check your settings by clicking 'How to check your Outlook Express settings', here:
http://www.ntlworld.com/webmail/
If you're not using NTL World (or the instructions don't make sense to you), please post again (telling us who your e-mail account is with) and we'll help you out.
Chris