I am not sure how this feature works. Except that some of the resolution depends on the physical size Xara reduces large photos.
For example, I have a photo that is 850px wide at 300dpi. I dragged it from the desktop into Xara. If I being it in at the Original Size it comes in at 800px (my setting for imported photos) at 319dpi. At Reduced it comes in at 800px width and at 230dpi.
I am sure that those who are good at maths can tell me what is going on here. But the images definitely are not set to 96dpi if you chose the Reduced size.
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