Billboard visualization of particles - and especially their animation - is one of the more arcane concepts in Blender. We're going to shed some light on this.
Now you've got your armature, but it's not much use until you add some more bones to it. Think about your body for a moment -- you've got this thing you call a 'skeleton', which for our purposes corresponds more or less to an armature object. Read on, for more useful information!