Dear David H,
I am facing the same issue and this seems to be a bug with the most recent version of Paint (11.2512.211.0). Everything was working fine until 2 days ago, when Paint got updated. So I decided to downgrade Paint to the previous version, which is not exactly straightforward. Consider the following steps:
Step 1: Go to https://store.rg-adguard.net (Although not affiliated with MS, its a legit site which hosts original msixbundles directly from MS servers. You can do a quick online search for confirmation)
Step 2: On the left of the search bar, select PackageFamilyName from dropdown and search for Microsoft.Paint_8wekyb3d8bbwe
Step 3: There should now be several links available. Download Microsoft.Paint_11.2511.291.0_neutral_~_8wekyb3d8bbwe.msixbundle (722.88 MB). This is the previous bug-free version of Paint.
Step 4: You may receive warnings from your browser for msixbundle download, simply ignore them. Double-click to initiate installation, again ignore warnings and reinstall.
This should install Paint (11.2511.291.0) without this annoying resize bug. Hope this works out for you too, happy painting!
P.S.: Dear MS Staff, please take note of this bug. This is not an issue with tall images. Even if one tries to resize the canvas, it snaps itself to 1152px x 648px and anything within it gets cropped. This is likely an issue with newer Paint linking display size of our device with image scale internally. Thank you.