@ Pirategurl: You can upload photos that exceed the actual size limitations. My current avatars picture is twice the size IMVU "allows".
You're friend was right, but I'll give you the step by step here:
1. Save the image as a JPEG or GIF file on your computer.
2. Go here
http://www.imvu.com/catalog/modules.php ... ditprofile
(If the above link does not work or for future changes, please go to your homepage then just click on your current avatars picture in the "about me" section.)
3. Look under the SECOND blue heading which reads "Profile Image Settings"
4. Look where it says "Upload profile image from your machine".
5. Click browse and find the file on your computer and click okay.
6. Scroll down to the very bottom of the page and hit the "Submit" buttom (Don't hit the reset button!)
7. Your screen will now say "Your profile has been updated Click Here to return to the Index".

FYI

Your image will appear to be the normal "standard" size on your IMVU homepage. BUT it will show in its original size when you post on group forums.
Hope this helped!