How to change my Login Background???

If I recall correctly, the wallpaper only shows at the lock screen, not the login screen. So if you are using your computer and 'lock' it, then when you wake it up later you will see your wallpaper.

However, when you're first booting up, Lion and ML will only show the linen texture.

 

I used these instructions back on Leopard. I haven't tested them on Lion or ML, so they may not work the same:

To replace login screen background:

1. Enter the following commands in Terminal, pressing Enter after each:
   • cd /System/Library/CoreServices
   • sudo mv DefaultDesktop.jpg DefaultDesktop_Old.jpg (enter password when prompted)
2. Quit Terminal
3. Rename desired image to DefaultDesktop.jpg
4. In Finder, drag and drop the image into /System/Library/CoreServices
5. When asked, click Authenticate and enter user name and password for your Admin-level account.
6. Restart

 

This does not work on 10.8.3. Onyx from MacUpdate is by far the easiest. You can change the login background and even choose to hide the Apple logo watermark. Unfortunately it still leaves the "hazy" overlay, and the image I used had too high of a resolution and this does not make it fit the size of the screen. You'll have to have the proper resolution for the size of your display.

Using Onyx I was able to find that it's modifying System/Library/PrivateFrameworks/CoreUI.framework/Versions/A/Resources/SArtFile.bin/sartfiles
Here there were two images: 272-1.png and 272-2.png, the difference being the second is a higher resolution.