To me that looks like you simplified the text layer (turned to just a bunch of pixels instead of infinitely resizable type) and then resized it with the move tool. If you want text to be scalable you must leave it as type. You can tell if this happened by looking at the layers panel. If the text layer doesn't have a T on its left icon, then it's not text anymore.
Note that when using PSE's type tool, you are not limited to the font sizes listed in the drop-down on the tool's option bar. Highlight the displayed pt size, and enter a higher value, e.g. 110 or 140.
The scrapbooking folks have a work-around.
Have a look at this: