Your code is basically OK but, one part goes in the head and one part goes in the body. Also, the dimensions (highlighted red) should match the the largest width and largest height:
Code:
<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/1999/REC-html401-19991224/loose.dtd">
<html>
<head>
<title></title>
<meta http-equiv="Content-Type" content="text/html; charset=iso-8859-1">
<script type="text/javascript" src="dropinslideshow.js">
/***********************************************
* Drop-in Slideshow Script- © Dynamic Drive (www.dynamicdrive.com)
* This notice must stay intact for legal use.
* Visit http://www.dynamicdrive.com/ for full source code
***********************************************/
</script>
</head>
<body>
<script type="text/javascript">
//Define Image Array. Syntax: ["image_path", "url_destination", "url_target"]
var myimages=new Array()
myimages[0]=["http://www.stacygrant.com/db1/00013/stacygrant.com/_uimages/M.Jacobswithball1small.jpg", "", ""]
myimages[1]=["http://www.stacygrant.com/db1/00013/stacygrant.com/_uimages/journeylead.jpg", "", ""]
myimages[2]=["http://www.stacygrant.com/db1/00013/stacygrant.com/_uimages/playinaction.jpg", "", ""]
//Create new drop-in slideshow
//Syntax: new dropinslideshow(image_array, slideshow_width, slideshow_height, delay_before_rotation)
new dropinslideshow(myimages, 432, 432, 3000)
</script>
</body>
</html>
Finally, you must download the dropinslideshow.js file (as you say you have), and place it in the same folder as your page.
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