Front Page 1 background image height

Do you have a link to your site so I can take a look?

There is a max-height which can be found in the CSS on line 1552 –

.front-page-1 {
    max-height: 740px;
    position: relative;
}

If you remove/comment out or adjust this then the background image will adjust to fit the screen (as well as the entire widget area).

Since you’re using text in this widget area rather than just a background image (like the demo) you’ll probably want to add some padding-top to push the text down some? If so, you can add something like this –

.front-page-1 .flexible-widgets {
    padding-top: 200px;
}

That would push it down some, you can adjust if needed.