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The Metro style Photos app brings together pictures from local and cloud-based sources. Click teh Settings charm to display the options shown here, where I've temporarily disabled the Flickr account.
Pro tip: Install the SkyDrive desktop app for Windows and you can see photos stored locally on other SkyDrive-enabled devices in this same view.
Albums and folders are presented in identical fashion in the Photos app, with large tiles. Swipe or right-click to display the normally hidden controls at the bottom of this screen. The Import button (on the far right) lets you add photos from a memory card or camera.
I'm sorry. I just love this photo.
So I'm using it as an example of how you can click or tap any photo to display it in full-screen view, then use the options bar to set that photo as the Lock screen or as the app tile or background for the Photos app.