Open the inspector (command-option-I)

  1. Click on a photo
  2. Click on the wrap tab on the inspector
  3. Click on the Inline (moves with text) button
  4. Uncheck object causes wrap

This will allow you to put photos side by side.

To add spacing between the photos

It's a little tricky, but navigate with arrow keys and enter a space between the photos. One space will give you the border shown below.