Some photos in your iPhoto library may not be accessible from the Desktop tab of the "Desktop & Screen Saver" pane of System Preferences if you have deselected the option to "Copy files to iPhoto Library folder when adding to library" in iPhoto preferences.
The "Change Picture" duration option at the bottom of the Desktop tab may not be available with some iPhoto albums.
To work around this issue, export the photos you want to use from iPhoto to a folder in your Pictures folder. Select this folder using the "Choose folder..." option in the Desktop tab of the Desktop & Screen Saver system preference pane.