Make sure there's a bootloader burned on your Arduino board. To check, connect an LED to pin 13 and reset the board. The LED should blink. If it doesn't, see the Bootloader page for instructions on burning a bootloader to the board.
Binary sketch size: 1018 bytes (of a 30720 byte maximum)C:\Program Files (x86)\arduino-0022\hardware/tools/avr/bin/avrdude -CC:\Program Files (x86)\arduino-0022\hardware/tools/avr/etc/avrdude.conf -v -v -v -v -patmega328p -cstk500v1 -P\\.\COM3 -b57600 -D -Uflash:w:C:\Users\Ken\AppData\Local\Temp\build6283579104717191924.tmp\Blink.cpp.hex:i avrdude: Version 5.4-arduino, compiled on Oct 11 2007 at 19:12:32 Copyright (c) 2000-2005 Brian Dean, http://www.bdmicro.com/ System wide configuration file is "C:\Program Files (x86)\arduino-0022\hardware/tools/avr/etc/avrdude.conf" Using Port : \\.\COM3 Using Programmer : stk500v1 Overriding Baud Rate : 57600avrdude: ser_open(): setting dtravrdude: Send: 0   avrdude: Send: 0   avrdude: Send: 0   avrdude: Recv: avrdude: stk500_getsync(): not in sync: resp=0xe0
Hmm, you definitely have a Duemilanove 328, right? Not one with a 168 or an Uno? Just checking.Are you running any programs that might be accessing the serial port? Things like PDA sync devices or bluetooth applications or even some firewalls or other security software can cause this sort of problem.
Analog values: 196195191197200197
Try thisPlug in the ArduinoChoose the correct serial portOpen the serial monitorConnect a wire between pins 0 and 1Hold down the reset button while you type something in the serial monitor and press send.Do you see what you typed in the serial monitor?