How do I choose a specific picture as cover for album?

It's controlled from iPhoto. The cover photo in iPhoto will be the cover photo on iPad.

Go into an event on iPhoto and select your desired picture, right click, and select "make key photo". Synch and you'll be there.

On iPad in Photos(directly from iPad manual):

Wallpaper and Lock Screen Photos
You can display a photo in the wallpaper background of the Lock screen and Home screen. You can choose from several wallpaper pictures included with iPad, or you can use a photo of your own.
Set a photo as screen wallpaper:
Choose any photo and tap (icon-square with an arrow) , then tap Use As Wallpaper.
Drag to pan the photo, or pinch the photo to zoom in or out, until it looks the way you want. Keep in mind that the image will be displayed in both portrait and landscape orientations but won’t rotate.
Tap Set Wallpaper. Then tap to use the image as wallpaper for the Home screen, on the Lock screen, or both.
To choose from several wallpaper pictures included with iPad, go to Settings > Brightness & Wallpaper.

Message was edited by: Johnathan Burger

I'm actually having the same issues except I'm using Aperture. I've set the key photo for all of my albums and none of them sync over to the iPad.

Any other solutions?