From the profile page, click the "View/Edit" button below whichever photo you wish to change the setting for.
Once on the edit page for that image, you can choose to set it as the "Primary Photo" - which yields the thumbnail image on your first link above,; or as the "Background Photo" - which yields the second example. You MUST 'Save' whichever change you make in order for it to take effect on the Profile.
Not sure the image size of the upload has anything to do with it.
Or am I misunderstanding your question?