It looks like what you're describing is actually the proper behavior, though it's not particularly obvious why that's the case.
Android, by default, scrolls your wallpaper to the left and right when you swipe around your home screen. This means that there's a sort of "virtual" desktop that represents the collection of your home screen pages, and it is (basically by definition) larger than the screen's resolution. The general rule is that the resolution of the virtual desktop will be 2x wider than the screen's physical resolution, but the height will be the same.
Therefore, when Android is cropping your image for your 1280x800 screen, it's actually attempting to create a wallpaper with an aspect ratio that lines up with your 1280x1600 virtual desktop. Thus, if the image you use is 1280x800 (like your screen), it will be cropped and scaled in the process.
If you'd like to make a wallpaper that fits the sizing of your virtual desktop without any cropping, What is the default resolution of a wallpaper that fits the homescreen exactly in an Android phone? contains some useful links and resources.