Hi Darby, you’ll get a better result if you first trim your logo of all the surrounding whitespace in a graphics program, put it on a transparent background, and save it as a transparent PNG. Once you do that, it can then be positioned with CSS as a background image instead of using the built-in header tool.
When your transparent PNG logo file is ready, please start a new thread and we can help you with the custom CSS needed to position it.
https://theme-support.wordpress.com/forum/automattic/mood/#new-topic-0