I just figured out a similar problem I was having. I think the problem here is with the plugin’s cache files becoming out of sync with the new image sizes set in the settings->media and subsequent thumbnail regeneration.
Try deleting the all the files inside the /wp-content/plugins/simple-post-gallery/cache directory. The plugin should then regenerate the cache according to the new image size settings.
It might be nice to have some control over the cache in the plugin’s settings page.
