Pages Image Quality Degrades When Dropped from Desktop or Inserted

I'm having a problem with image degradation when dropping an image from my desktop into Pages. Even though it's a large file, the quality and resolution is obviously reduced when it's dropped into Pages. I can view the file on Preview and in Pages side-by-side and see a dramatic difference.

I'm trying to keep the total file size of a Pages document smaller and more manageable. I'm a photographer too, so I'm familiar with the file size needed for proper resolution, but I'm just not seeing it come through in Pages.

Anyone else having a similar experience? Any ideas what could be wrong?

Thanks!
-Dan