How is this confusing? I think people are thinking about this way too much.
Medium size is quites straight forward. Set your medium threshold much like you set thumbnail and walk away.
The only setting that requires any thought is the original. If you want to save originals then you dont restrict the size.
I beleive we can look at further adding an option to keep originals though most people will not use this as its a diskspace hog in the extreme.