Update: please refer to my comment for the latest status on this ticket.
Thanks for the continued feedback and completing the survey, which helped us understand your pain points with the current design. The majority (84%) of example logos provided were rectangular in shape, so simply preventing the rounding of space logos (as some requested) would not solve the problem for these 84%. Therefore, we have built a new uploader which works for both square and rectangular logos.
With the current uploader, you can only select a portion of a rectangular logo, e.g.:
With the new uploader, you can zoom out and crop ‘beyond’ the border of the image, allowing you to fit the entire logo in, e.g.:
This works for a square logo as well, and allows you to adjust it inside the area that was previously clipped due to the circular mask.
These changes will be shipping in Confluence 5.6 and in a Confluence OnDemand update in the next few weeks.
Thanks again to all for your input and feedback, I'll now be marking this issue as closed.
Confluence Product Manager