Hi Maarten
Sorry for the long wait for a reply, the ellipse is simply an inertia ellipse. Its just meant to highlight the individuals of the group and shows most of the group were projected within that location on the axes. It is not a confidence ellipse. To turn off the ellipse, set ellipse to 0. To draw a bigger or smaller ellipse change it to 2.5, 0.5, whatever you wish. A larger cellipse will draw a larger circle around the points in the graph. The ellipse just summaries the graph and does not represent any confidence.
plotarrays, calls plotting functions in the R package ade4. Ellipses are drawn by the function scatterutil.ellipse. Have a look at the code, its pretty simple.
plotarrays gives the size of the ellipse 1.0 to the paramater cellipse in the ade4 function scatterutil.ellipse. The default cellipse is 1.5.
In plotarrays, I changed it from cellipse from 1.5 to 1.0, I probably found a smaller ellipse to be more useful given the noisy data I was analyzing. Feel free to change it back to 1.5.
This has been much discussion about this on the R forum http://lists.r-forge.r-project.org/pipermail/adegenet-forum/2011-May/000281.html which links out to a more detailed discussion the ade4 forum http://listes.univ-lyon1.fr/wws/arc/adelist/2011-05/msg00003.html (you need to click on the button "I am not a spammer" and it will take you to the discussion). If you can read french, also see http://pbil.univ-lyon1.fr/R/pdf/qr3.pdf, however feel free to ignore the section in this pdf document where they discuss the groups are samples drawn from a bivariate normal distribution, this is unlikely to hold for most data.
There are some recent graph packages, I like ggord which draws pretty plots but is a little limited. Its available on github.
Best
Aedin