Basic CS5 Question

I am a professor at a medical school and am completely new to Photoshop. A few years ago, I created a number of educational tools for my students using the Open Office drawing program (saved in JPEG). These consisted of various photos taken of human tissue samples, to which I added arrows and text labels indentifying important parts. I would like to make some modifications to these images, adding new arrows and text in some cases and in others simply changing the text that already is there.

If I use the eraser function to remove text, it not only takes the text but also the underlying image. Is there a different way to do this so that I can retain the image underneath? Alternatively can I fill and blend the white swatch left by the eraser using material around it?

I have been looking through the tutorials, but have been unable to find one that addresses an issue like this. Can someone help me or at least point me in the right direction?

Thanks!