They say a picture is worth a thousand words.
All by clicking the resize icon:
How can I stop it from doing it?
I'm on a 24" iMac (early 2008).
Well, I'm on Windows, but I've had the same problem sometimes. The solution is to resize the window with your mouse (click and drag the bottom corner) hit maximize, then if you resize the window again, it should resize to the size that it was before you maximized it.