Auto evertyhing in D300

Hi. I am sorry if this post offends anyone but I really need answers.

I am new to professional DSLRs. I went from Sony F828 to Nikon D300. I bought it to take pictures of my busy kids. And now, after reading the manual - I am more confused then ever. I took a few pics - and they came out horrible: out of focus, dull.

I purchased my camera and 70-300 lens kit from Costco.com (in case if you need to know which lens I am using.)

I tried to set the camera up to be all Auto. I have changed the ISO setting to be Auto and focus. I could not find any other auto settings in the camera - are there? If so, how could I access them?

Why are my pics out of focus if focus is set to auto? On the lense, there is a swtich that goes from M/A to M. I set it to M/A - I guess that means Manual or Auto.

Please, any help appreciated. I am just lost.