Hey Geoff,
The content slider and most other modules in the builder use the small breakpoint, the medium breakpoint is only used by the column settings. So that’s probably why it wasn’t working for you. However, if you do change that to 1024, your entire site will become responsive at that size, which I’m sure isn’t desired. If it is, by all means do it 
You could write a media query to show fl-slide-mobile-photo on bigger devices while hiding fl-slide-bg-photo.
I would urge you to try the photo option. I’ve done that on a few sites and it works out great. Check out this homepage for reference… http://parcforetmontreux.com/
Let me know what you think.
Justin