Since Illustrator is an object-based graphics application (whereas Photoshop is mostly pixel-based raster graphics app), the JPEG can be represented *at any size* without changing the underlying graphic. That is to say, you can scale the JPEG down to fit whatever canvas size you have in Illustrator, or scale the canvas and vector elements up to meet whatever size the JPEG happens to be. When Illustrator brings your JPEG image into itself, it's just doing a quick calculation based upon the specified canvas attributes and the JPEG's resolution. If you change the canvas specs and then bring the JPEG in again, it should appear to be a different size. If you scale the JPEG up or down in Illustrator, you're not losing any resolution--the underlying source graphic is still the same as it was before. After you've put all of your vector text on top of the JPEG, you then need to pay attention to your output resolution. If you're printing, you're constrained by the printer's resolution. If you're exporting to a new raster format (like a new JPEG that now includes all of the text you've added), then you'll need to specify the output resolution carefully, because there will likely be some interpolation. I recommend using the very powerful SAVE FOR WEB dialog box when doing this, as it lets you preview what your output will look like before you save it. (ALWAYS use Save For Web, in Illustrator or in Photoshop, when you're saving the file as a GIF, a JPEG, or a PNG. Always.)