The preferred way to customize Speed Dial is to use the Speed Dial options panel. To invoke it, go to the "Add-ons" panel, select "Speed Dial" and then click on the "Options" button.
"Thumbnail size" is used when saving a new thumbnail. The browser will be scaled to match the width of the new generated thumbnail, and cropped in it's height if necessary.
"Background browser size" defines the width and height of a hidden browser that is used to load the Speed Dial slots when they're refreshed. The smallest the value, the more readable it will be when taking a thumbnail of it. However, the default width value (800 pixels) should work well with most websites, and provide a good balance between layout accuracy and readability.
The configuration parameters described above ("Thumbnail size" and "Background browser size") only have effect when creating or refreshing thumbnail, so changing their value won't have an inmediate effect.
There are many more options in the settings panel. Most of the are self-explanatory. At any point, it is possible to restore the intial settings by using the "Restore defaults..." from the "Settings" button in the lower left side of the settings panel.