Yes there is a default tire size set at the factory in the computer. It is used for lost of different calculations. When changing it will adjust the shift points (on an auto), change the speedo, there are others but I'm drawing a blank
When we set ours to the correct size I noticed my lie-o-meter didn't lie so much either.
It uses the size to set the Revolutions per mile of the tire. Here is the brake down for the stock tires:
P245/70R17 (WRANGLER SRA-GOODYEAR) 685
LT245/70R17 (LTX A/S-MICHELIN) 675
LT265/70R17E (LTX A/S-MICHELIN) 657
LT245/70R17 (RUGGED TRAIL T/A-BF GOODRICH) 684
LT265/70R17E (RUGGED TRAIL T/A-BF GOODRICH) 658
LT285/70R17D (ALL TERRAIN T/A-BF GOODRICH) 632
P265/70R17 (WRANGLER SR/A-GOODYEAR) 657
P265/70R17 (WRANGLER GS/A-GOODYEAR) 661
LT275/70R17E (WRANGLER-AT/S GOODYEAR) 649
LT275/70R17E (TTL-GOODYEAR) 649
P275/55R20 (EAGLE LS-GOODYEAR) 655
P275/60R20 (WRANGLER HP-GOODYEAR) 636
LT235/80R17E (WRANGLER SRA-GOODYEAR) 649
LT235/80R17E (WRANGLER GSA-GOODYEAR) 649
LT235/80R17E (AMERITRAC-GENERAL) 649
LT235/80R17E (AMERITRAC TR-GENERAL) 648
[and just as a side note....if you're not on stock tires and would like to see what your Revolutions per mile are of your tires you can go to
http://www.csgnetwork.com/tireinfo4calc.html and it will calculate it for you]