BuddyPress.org

Congrats on fixing the issue – although what you did makes no sense to me.
It would seem that your users can now upload 25 MB avatars.

Post your bp-custom code re full-size and crop tool.

Did you ever try a png ?
That would let you know if it’s a compression issue or something else.

My complete guess is that the images are being downsized prior to cropping and then expanded to your dims which is causing pixelation.