Yes, it's initially surprising, and then it gets terribly annoying.

If you look around further, you'll notice that it gets a LOT worse than that particular example. While developing Twitter support on an iPhone app, we discovered that some account icons far exceed 1MB in size, which ended up causing us some memory usage issues. So it goes..

I just don't understand how a system riddled with performance issues could make an oversight like this.

Unless I'm starring one of the causes of the performance issue in the face.

I think you might want to try http://getsatisfaction.com/twitter/ or http://help.twitter.com/.

For infrastructure upgrades? Seems more like an internal issue than a user issue.