I was really sorry to hear that Picnik was closing it's doors later this month. It's a site I have used for a few years and was even a paid up member for a while.
There are more complex and technical sites and downloads out there that can do better, but for simplicity and a good result I always liked this.
I was asking around for a similar type of site and Justine of Sew Justine Sew recommended PicMonkey.
It's great, I would go as far as to say that I prefer it to Picnik it seems much faster and smoother to use, apparently it is created by the same people involved in Picnik!
If you are looking for an alternative to Picnik give it a whirl!
Thanks again Justine!
(no affiliation just happy with the service)