There is a "flash" button in an upper right corner of a viewfinder. Touch this button to set "flash" on. Now when you take a photo,its brightness will be automatically enhanced. You can change the intensity of "flash" in the app settings.
There is a bug in iPhone OS 2.2 which affects images with 800x600 size. If you have iPhone OS 2.2, update it to the latest vesion (3.1). Otherwise you need to make sure that the output image size is not set to 800x600 when saving the edited image. Each time before saving an image, go to Tools->Misc and set output size either to 640x480 or 1024x768.
You need to restart iPhone/iPod. Alternatively you can press Image->Reload, however without iPhone restart the black screen is likely to appear again. Another option is to select smaller canvas size (Tools->Misc->Canvas select 160x120) and re-open image via Image->Open. Still, quick iPhone restart will be the best possible solution.?Also, remember to save your image regularly (it's quick: Image->Save), so that next time you can safely re-open it.