I've managed to solve how to change the size of the images. For anyone that has the same problem, you need to edit line 34 in category.tpl
getCatImageLink($subcategory.link_rewrite, $subcategory.id_image, 'medium')}" alt="" />
To have large images, replace 'medium' with 'large'.
getCatImageLink($subcategory.link_rewrite, $subcategory.id_image, 'large')}" alt="" />
To keep the original size of the images, leave the quotes empty.
getCatImageLink($subcategory.link_rewrite, $subcategory.id_image, '')}" alt="" />
This change to the code works, but if it is the wrong way to do it, please correct me. Thanks, Mike