open up the small picture, press Ctrl+A (mark all) then Ctrl+C (copy). Close it. Then open the large picture, press Ctrl+N (New Layer) and Ctrl+V(Paste). In the toolbar just select the standard arrow and you can move about the smaller picture until your happy with the position. Then just get the type tool (it's the capital T in the toolbar), select the place you want to type and enter the text. After that highlight the text and you can change the text setting at the top (font, color, size). Then just save.
If at any point you aren't happy with the positioning, choose the layer and change the position in the layersbox. If it isn't visible then go to window->Layers.
It's easier then it sounds. However, if you have any problems, don't hesitate to PM me with the pictures and a description of the picture positioning and font settings.
Hope I helped
Marcin