There is currently no easy way to get bigger and better looking caller id photos. The reason is Google. When your contact pictures sync to your gmail account they get shrunk to 96x96 pixels. And so this is the maximum dimensions that Samsung uses for the caller id, as do most other companies besides HTC (their Sense UI shows an enlarged picture that is of better quality, but still not the sharpest looking).
What I have done temporarily is disabled contact syncing under my gmail account on the phone, and using SYNC MY PIX to provide high resolution pictures straight from Facebook.
Until the EPIC gets themeing capability so that a themer can replace the 96x96 image(s) that the phone uses, your caller id will still be the same size, but at least it'll be perfect quality