You can only put wallpaper on the XMB if you are using Firmware 1.90 or greater. You can put a photo as a wallpaper by finding the photo you want and pressing TRIANGLE to bring up the onscreen menu. From the menu, select the “Use as Wallpaper” option. Before the photo is added as a wallpaper, you have the ability to zoom in or out of the photo.
Can I put wallpaper on the XMB? How?