Though I'm not an expert on picture manipulation, I have experienced similar issues with video. Let's say you have your favorite movie on DVD. You convert it to mpeg or 3gp format and import it to your phone via USB or Bluetooth. That's good and great and all, but your phone does not have 640 x 480p resolution...so when converting it you shrink it to the screen size or slightly larger. There's 2 reasons for this...1. the screen will not display anything any sharper than the total number of pixels that make up the screen and 2. because of this, the extra space on your memory card for the extra information is totally wasted thus giving you fewer movies to watch on your ridiculously long, boring flights.

I think it's possible that the phone, anticipating the fact that it can only see pictures of a certain size, calls out to the source of the media and tells it to use small instead of large or HD. Having the original model (CU500) I found that when I imported pictures (that I took with a sharper digital camera) via Bluetooth from my PC, the pictures remained the larger size, but only displayed as smaller when on the phone. Accidentally re-importing them back to the PC caused no noticeable change in compression/ file size/ attributes. In other words, consider downloading from your PC into your phone instead of directly to your phone if maintaining the original attributes is important to you. You have a slightly different model, but I think it's worth a shot.