This is a question I get from time to time from the people who have widened their blog by following one of the three column conversion or wider post column guides. This post is an answer to that question.
The header image is uploaded via the Header element in the Layouts -> Page Elements section.
The available size for this image depends on the size of you header. For example, in the Minima template, it is the width of the #header-wrapper CSS selector. If the image you upload is smaller than this maximum available size, Blogger will upload it as it is. But if the image you upload has a higher width than the available size, Blogger's action will depend on whether you've selected the Shrink to fit option in the Configure Header dialog box. If that option is selected, the width of the image you upload will be resized to the maximum possible size. (The height of the image will also be adjusted to the same scale to avoid distortion. But the reference dimension is the width). If Shrink to fit is not selected, the image will be uploaded as it is despite it being bigger.
When you customize your blog either by adding a third column or by expanding the size of the post area, the header size will also be widened to match the new blog width. Therefore, you will have to re-upload the header image. If the current header image is smaller than the new blog width after the expansion, then you have to widen the header image as well. For that you need to use some image processing software such as Photoshop. If, however, the image you uploaded had an actual width that is bigger than the new expanded header size, a simple re-uploading will do.
