Ok here we go 
The image you need to use is that a tileable pattern or some sort of image with a motive?
In case it's a tileable pattern there is no problem no matter how small/big the container is, the image will just tile/repeat itself infinity. On the other hand if it's an image with a motive it's a problem, and if it can be done, I'm not the right person to ask.
But back to the actual content problem.
Do this:
1 - download and open the file template_css.css from the template/versatility/css folder
2 - remove all the stuff that you have added
3 - save the file and upload it to the same folder you got it from, if your ftp program asks to overwrite, choose yes
4 - log into your Joomla admin panel and in the top menu pick the following sub section site/template manager/site templates
5 - you will now get a list of all installed templates add a "mark" in the circle radio button left of the Versatility template and press "Default" in the top right menu
6 - now that the template is selected as default, add a mark once again in the same radio button and choose "Edit CSS" in the top right menu
7 - you will now be presented with the template_css.css file and you should now scroll down to the bottom of the file and paste the following stuff in the bottom of the file
.container1 {
float: left;
padding: 10px;
margin: 20px;
border: 10px solid #5e776b;
width: 270px;
/* ie5win fudge begins */
voice-family: "\"}\"";
voice-family:inherit;
width: 240px;
}
8 - before you press "Save" make sure that it says "template_css.css is Writeable" above the css list, if so press "Save"
9 - now you need to add this class to some text it can be both dynamic and static content
10 - go into "Content / All content items" in top menu and press "new" in top right menu
12 - in the "title" and "title alias" field type "test"
13 - in the "intro text" field (the first big white one) type "This is just a container 1 test" - without the quotes
14 - select all the text with your mouse, so the text turns white and the background of the text blue
15 - just above the text field you are writing in there is a drop down menu called "Styles", scroll down to "container1"
16 - press "container1" and voila text transforms into what we wanted
IMPORTANT / THE ONLY TIME I HAVE NOT SEEN CONTAINER 1 PRESENT IN THE STYLES MENU WAS WHEN I HAD ANOTHER TEMPLATE AS DEFAULT - REMEMBER THIS CONTAINER1 CLASS IS ONLY AVAILABLE FOR THE TEMPLATE_CSS.CSS IN VERSATILITY FOLDER - IF GAZETTE IS DEFAULT CONTAINER1 CLASS WILL NOT SHOW IN THE ABOVE STYLES MENU
If the above those not work, I don't know what is wrong m8.