InDesign is kind of funky in that images can be played with in different ways. Unlike most programs, dragging on the boundaries of an image won’t immediately resize it; instead it just changes the picture frame.
Imagine you have an object behind a wall and there is a hole in the wall. You can move the hole or make it bigger or fill it in so that you see different parts of the image. To actually resize the image you would need to go behind the wall and move the object. So, despite the terrible analogy, that’s the idea. You can resize the picture frame, you can resize the actual picture, and you can change the text wrap boundary (more on that last option under "How can I change the text wrap so it isn't just a simple circle or box?).
To crop an image just drag on the boundaries of the image. This will move the boundaries of the image but won't actually resize the image to fit the box that you are creating for it. This is actually kind of useful if you find that you have an image that doesn’t quite fit; all you have to do is resize the picture frame rather than going into an entirely different program to manually resize, resave, and re-import into InDesign.
To resize an image without cropping all you have to do is select the image using the Selection Tool (black arrow) and hold down the Control key as you resize (Apple key on a Mac).