If I download a picture from the internet, can I frame it and sell it. Could I sell the frame and give the photo away with the frame for free?

It depends on the copyright status of the picture you download. As a general matter, the Copyright Act prohibits most forms of commercial copying. If the picture is subject to a copyright, then if you "copy" it and sell it, with or without a frame, you are making unpermitted copies and are subject to damages, attorneys' fees and other relief if the owner of the copyright decides to sue you. You can avoid this result by using only pictures that are in the public domain (in general, that were created a very long time ago) or by using pictures with respect to which you have received permission or a license.