Hi Sin,
First things first, it is very important to get your saddle height right. Ideally, when you are seated on the saddle and one of the pedals is in the lowest position with your foot flat on it, your knee should have a slight bend, only a few degrees. Unfortunately only way to do this is by trial and error - move the saddle up a little at a time, and then sit on the bike either leaninig against fence/wall, or get a friend to hold the bike up, and check that your leg is comfortably extended. When you feel it is about right, go for a short ride and test it out.
Figure 3 in this article :
http://www.physsportsmed.com/issues/...mar/kronpa.htm
shows what I am talking about.
With regards to pedalling, the aim should be to turn smooth circles with your legs, in a fairly easy gear to begin with. This is why you have the gears, as it becomes harder to pedal, for example up a hill, you should change gears in order to keep "spinning" smooth circles. Contrary to how this may "feel", spinning in relatively easy gears is FANTASTIC conditioning and will burn off a lot of calories. What you want to avoid, particularly to start with, is pushing the pedals forward with your legs on each stroke as this places a lot of stress on the knees. You can do this for short periods once you have built up the muscles in your legs, but like any sport, it is best to ease in to it so your body can adjust and strengthen itself to the excercise involved.
I am sure I will think of more things... any questions just let me know!