If you use jpg (which is ok for most purposes) do NOT use a more compressed mode. (Highest resolution is lowest compression; higher compression is lower resolution.) There will be artifacts in the image. JPG does not just drop pixels, it changes them. I can assure you, if you set your camera to some low-res mode, you will take that once in a lifetime shot, and wish it was a full size file.
"Less is not more. Enough is enough. Less is less." David Vestal
"I am always doing that which I cannot do, in order that I may learn how to do it." Pablo Picasso