I thought I would play with this myself, loaded up a site and started to toss every image I could think of at the logo section of the site and oh my your right everything got stretched to ungodly aspects.
Then I started to choose smaller logos as I had a few that I made shrunk for the likes of youtube/twitch etc… I found that the size 160×160 (pixels) showed up best
Thank you both! I figured out that for this theme, any image taller than 45 pixels will be force-resized to fit the block. Rather than edit the CSS or override the style, I simply created a logo that was capped at 45 pixels tall, and everything worked out great.