I understand auto rotation is gone in the version I am using. I can manually rotate all my image. So, is there a way to auto rotate an image? When I upload a photo from the iPhone it is not oriented correctly. How can I fix this?

Zenphoto does auto rotate actually if the information about the orientation is embeded in the meta data of the image (EXIF). So I can only assume that is not the case on the images you are using (I don't have any iPhone).

There is also a manual way but it all requires your server being able to do it:
http://www.zenphoto.org/news/problems-with-albums-and-images#the-image-rotate-button-on-the-backend-is-grayed-o