New MacBook Pro User -How to set up Dictation Function

Hello. I have just purchased my first MacBook Pro. After many years using a Windows PC, I have finally jumped over to the Mac side. Please bear with me as I am a new user and I am in the process of slowly setting up and learning this new MacBook. I have upgraded the OS to Mac OS X Version 10.7.4 which I believe is Mountain Lion. Now, I am attempting to enable the Dictation function with no luck. When I click on System Preferences, I want to select 'Speech and Dictation' from within the System functions, however, all I see is a 'Speech' widget which shows a microphone icon. If I click on the 'Speech' icon, it opens into 'Speech Recognition' and  'Text to Speech'. There is no 'Dictation' function listed. It seems that no matter what I try, I can't get this to work. I tried using it with TextEdit but had no luck. I believe it is enabled by pressing the Fn key twice. I anyone can maybe walk me through this, I'd really appreciate it.
Thanks,
Tony

I was able to download & install Mountain Lion and everything looks ok. I did run across one slight issue. It seems that with the Mountain Lion installation, the Dock is now sitting lower on the bottom of the screen. As a result, the blue active icon indicators do not show up on the screen. I haven't changed the screen resolution so I don't understand why this happened. Not a big deal, just an annoyance.
Thanks again,
Tony

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