Please check the AutoScale Settings and the FormFactor of your project: http://www.hjgode.de/wp/2013/04/19/windows-mobile-6-5-changed-screen-geometry/
I assume you have set QVGA in the project and AutoScaleMode=DPI and run the project on a VGA device.
You can also change the picturebx to strech the image into the picture box size. So the image will be scaled up or down to fit the picture box.