The designer will normally deal with the optimising, sizing and placing of of illustrations. But you need to agree the costs with the author/publisher first. Regarding placing the images, have they been already scanned and, if so, have they been scanned correctly? For example, color space and reasonable resolution (e.g. normally 300ppi for a same size color illustration).
What problems are you having with placing the illustrations?
After you've sorted out the above, It might be a good idea to produce a few specimen pages to show the author/publisher and to also discuss it with the book's printer before you commit yourself and produce the whole book!
Lynda.com have excellent online tutorials on how to use InDesign, and other applications, and you can ask more specific questions on this forum of course:
Derek