[Useless]

I haven't been building free sites very long and I still struggle with this myself. A big part of me does not want to give the surfer too much. Another part agrees with what was said earlier. Your site should be representation of that which is being marketed. I think we, as both designers and marketers, need to find a happy medium. Huge high res photos may please the surfer on their own. Small pixelated ones may kill the potential sale. I tend to believe that they who build with the larger, higher resolution photos are more careful about their pic selection. They probably don't include shots that are definate load-blowers. If you decrease the size and quality of the pics, you can allow a couple of hot ones slip through.
That being said, my target is 600 on the long side. Quality wise, I don't stick to a single setting. I adjust for each pic depending on the content. As for thumbs, I have been going for 120-130, but I have been considering using a larger size since a lot of people say larger thumbs will keep the surfer from clicking each one.