Hi, I had all the same problems as the guy above, followed all the recommended steps, Regenerate Thumbnails, tried that CSS (which actually breaks the design with the load more posts functionality), uninstall/reinstall Related Posts, etc., and none of that helped.
I found the problem: the Related Posts plugin hard-codes the thumbnail size to 150 x 150 in the plugin's config.php. Once I changed that, I was able to get my custom thumbnail size to appear.
I tracked this down because no matter what I did, including removing the 150px thumbnail options from settings, my functions.php, etc., everywhere, the plugin continually kept pointing to a 150px thumbnail, whether it existed or not. I looked in the wp_post_meta table, meta_key: _wp_attachment_metadata, and saw that the wp_rp_thumbnail was set at 150... even though the "standard" WP "thumbnail" value was set at 266. Which means changing the WP thumbnail setting as described above does nothing, actually.
I changed all instances of 150 in that key to 266. However, after a reload or 2, it was back to 150. Which meant something was overriding this.
So, Zemanta, looking for guidance here: is this a bug? Are we doing something wrong? For now, I'll hard-code your plugin to my 266 value.
Are you able to instead of hard coding it to 150 make that an option in your plugin? OR... instead of using your wp_rp_thumbnail value, simply use the WP thumbnail value.