Using v1.3. I have a 720x540 full-size. It gets downsampled to 320x240 and 150x112 at upload. Choose the thumbnail file for Featured Image and the box displays the full-size image going off the right edge of the screen. Disable the plugin and the image goes back to 320x240 in the Featured Image box. It is changing the file being displayed; not just up/down sizing it.
The thumbnail is being sent to the post correctly.
Why WP doesn't display the file size that I choose (thumbnail) is another question, but that has nothing to do with SSMP.