When you try to upload, do you get an error message following the command line? Sometimes the Arduino software gives the "Couldn't determine program size" error even when the sketch compiles successfully, so that may not be a problem. Can you also enable build.verbose in your preferences.txt? And then post the full text of the messages you get when you upload (this will also compile your sketch)?
When I compile the program I get this:
C:\Program Files\arduino-0008\tools/avr/bin/avr-gcc -c -g -Os -IC:\Program Files\arduino-0008\lib\targets\arduino -w -mmcu=atmega168 -DF_CPU=16000000L C:\Program Files\arduino-0008\lib\targets\arduino\pins_arduino.c -oC:\Documents and Settings<name>\Application Data\Arduino\Blink2\applet\pins_arduino.c.o
Couldn't determine program size:
When I try to upload to the Arduino I get this:
C:\Program Files\arduino-0008\tools/avr/bin/uisp -v=4 -dpart=atmega168 -dprog=stk500 -dserial=/dev/com3 -dspeed=19200 --upload --verify if=C:\Documents and Settings<name>\Application Data\Arduino\Blink2\applet\Blink2.hex
And the files pins_arduino.c.o and Blink2.hex do not exist on my hard drive.