TypeEngine, of course, doesn't place a limit on the size of your files or your app. However, the goal of creating publications for mobile devices is to limit size for quick, easy access.
Currently, all images used in an article are copied into your publication. If you use the same image in multiple articles, you will need a copy of the image for each article. All articles and their assets are then saved to a .zip file, and that is downloaded as the "issue" to your readers' devices.
So, if your target audience is made up of readers with slow data plans on mobile devices, there are a lot of reasons to keep the resulting file as small as possible. If the target device is 480p, no point in making huge images; if it is Retina, maybe you want the full resolution. If your target audience is a university or corporate environment with lightning-fast network, no harm in large files as far as transmission (though of course there are device resource limits to consider as well).
Other points to consider are:
* Storage - Mobile devices may have severely limited capacity to store files, so smaller files are preferable.
* CPU - Processing an image file to display requires the device's processor to run; hi-res images need to be reduced to the size of the screen, so large images burn up CPU cycles (notices in time to display and battery drain).
* Memory - While processing a large file to a smaller one, intermediate memory is used to hold the result. If memory is tight, an image might not display.
* Packets - Smaller files typically arrive more reliably than larger ones, which is why real time voice is broken up into small packets. The packets are sent and are most likely to arrive quickly and completely. So, in general, smaller files are preferable technically.
If you have a "fast" network, and typical download times don't bother your readers, what some publishers do is actually add images to their publication then they display smaller images on smaller devices, and larger ones on larger devices. This actually increases the transmit time and storage size, but reduces the amount of time to display on lower-powered devices. That's one engineering tradeoff some make for a better user experience since publications are configured to download automatically and in the background. That is, the time spent waiting for a publication to download once is more than made up for by less time spent waiting for an image to display in repeated reading sessions.