iOS 7: wallpaper scaling workaround
I have come up with the following workaround for the scaling issue of your personal wallpapers.
You need photo processing software on your computer for this.
That software should be able to crop and resize your photos, but above all be able to put a frame around your photos.
If you do not have software like this, download IrfanView or something similar.
I am not sure whether IrfanView exists for the Mac.
I have tried this on my iPad 2 in landscapeorientation.
The iPad 2 has a screen resolution of 1024 x 768 pixels. For other resolutions, change the numbers accordingly in my instructions.
I have used IrfanView for this:
1) open your favorite photo in IrfanView
2) resize (Ctrl+R) the photo to 1024 x 768, if possible without preserving aspect ratio
3) if you want to preserve aspect ratio, you will need to crop the photo to your personal liking
4) add a plain black frame of 250 pixels around the photo (Ctrl+D)
5) save this new photo on your computer in the folder that syncs with your iPad
6) sync with your iPad in iTunes
7) on your iPad in settings > Wallpapers & Brightness choose the new photo
8) move the photo to the correct position
9) tap the "Set ..." option of your choice
Until Apple publish a better method to scale the wallpaper, this workaround should work for many of us.