It takes about one second to load a 1000x1000 avatar, I think it should al least tell you the max size on the profile page if it gong to have such a small limit.
Please note that this applies to your internet, but not everyone elses. However, as a PNG, a 1000 x 1000 image would likely be over 1 MB. On an 8 Mbps connection (pretty common in my area), it would take at least a second to download. In reality, internet speeds rarely hit their limit, so we can expect at *least* one second to download this image. Then there's up to 19 other user avatars on the same page. Even more, most of the time for a fairly fast connection will be in the request, not the download. For example, for my fairly fast
connection, there's approximately a 150 ms delay on pretty much every request because the server "handshake" with my web browser.
While this isn't a big deal compared to the incredibly slow page loading (about two seconds for the server to create the main forum page), I don't see any real need to extend it for something as trivial as avatars.
Also the error should say:
The avatar you have selected is either larger than 100x100 or not an avatar.
It's an SMF error.