The Sky & Telescope article on collimation is pretty good:
http://skyandtelescope.com/printable...rticle_790.asp
(it's also linked on the page Dave P linked and Rob linked it too. It's a popular choice

)
As far as the inverted image is concerned it's very easy to understand once one gets the hang of the basics of ray tracing for ideal lenses and mirrors, which is nothing more than a few simple rules:
- incident parallel rays meet at a single point in the focal plane, and vice versa
- for convex lenses this occurs on the opposite side of the lens, for concave the same side, as the incident rays are on
- any ray passing through the centre of a lens will maintain a straight line course
- focussing mirrors work exactly the same way, except for the "flip" about the mirror plane (it is easier when ray tracing to just replace all mirrors with equivalent lenses (or nothing if its a flat mirror) to keep the diagram neatly flowing)
And that's about it. That's enough to get you an A+ in year 12 geometric optics, because everything else can be worked out from these simple rules

(which I admit though need to be better explained and demonstrated than I've done here).
It's well worth investing a bit of time going through an introductory optics textbook, and getting to know the basics of ray tracing, because it lets one understand how a telescope and all the various eyepieces and other bits/attachments go together and work together.