I get the lat, long, and altitude from Google Earth pretty much as your said. Actually, I put a marker on that spot, but you can also just read it off of the status bar.
For getting that information into the picture, I use a software package called
RoboGeo. Any EXIF editor should allow you to do the same thing, but RoboGeo is designed specifically to handle those values. It also has a lot of other interesting features related to mapping photos. It's $40. There is a demo version that randomly shifts your values by about 1 kilometer.