Well, I personally don't think there is anything wrong with the current report system. It's simple and easy to use.
Also, instead of uploading a screenshot directly to the forums, you can use an image hosting site such as www.imgur.com and www.tinypic.com and then copy the link into the textbox on the forums.
As for the trollers, I definitely think they should be banned if everything happened as you said it did. This is a multiplayer game, there is always going to be trollers so you just need to learn to put up with it or, like @Kravaty said, download a video recording software like www.plays.tv and then report them yourself on the website.