I know this is quite an old thread but I felt it was better than creating a whole new thread again just for one, related question. Why is there a file size/dimensional limit on new avatars? Is it to stop people choosing stupidly sized avatars that take up space on threads? Or is to do with server space? Just wondering.
My hunch, and it's only a hunch, is that it's to prevent use of obnoxiously-sized avatars. I once visited a forum that had lax avatar rules, and users had gotten ridiculous. One user had a 300x200 anigif of Penn Jillette saying "Shut... The... [F-word]... Up!" in a loop.