RE: Just confirming that I should be adding this filter using the Code Snippets plugin?
Yes, this filter should be added using the Code Snippet plugin.
RE: I can’t add custom CSS to the theme
CSS can not be use to properly scale/cop an image optimized for web delivery.
RE: adjust the shortcode to make this happen?
If there were a shortcode option, I would have most definitely had supplied it instead of a filter.
RE: what is the difference between this and the image settings within the plugin? It seems like these are the same options as exist in the image settings, and those have very little effect.
As mentioned, those settings do not affect Gridder. Gridder will create its required images on demand based on the supplied image size. The crop and quality are not exposed as options in Gridder so the only way to change those defaults is thru the filters.
The crop and quality are based on the same defaults that WordPress itself provides to give a consistent experience.
Those settings only affect the default cached images sizes which are created when an image is added to an entry. Presently these primarily exist now to support legacy templates which did not have option to change image size like Gridder and other templates provide. I expect to remove these settings at some point due to them being less and less relevant in the current architecture of Connections.
I hope I have thoroughly answered your questions.