The script currently does not support uploading .png images, only .gif or .jpg. You can, however, upload the .png files via FTP and hotlink to them.
What do you mean by increase the upload size of pets? You mean filesize allowed? You can edit admuploadpic.php and find:
PHP Code:
if($filesize > 153600){
Change that 153600 to the allowable upload size in bytes. :)
Brandon