The Display Size has two selections that control which image is displayed:

Uploaded Size
Displays the image at either the size at which it was uploaded -or- if the image was larger then the maximum allowable, the maximum size (the image will have been scaled automatically by the system when it was uploaded)

Clickable Thumbnail
A smaller image that, when clickd on, shows the full size version. This is the most common type used.

Please Note for small images the thumbnail version may be larger then the uploaded size - it all depends on what the site preferences for maximum and thumbnail image size are.