My understanding is that the Icon/Avatar of a Kanban board is determined by what the Kanban board is based on.
If anyone else knows better and where to change this then please let us all know...
The rules in JIRA 7.3.2 seem to be the same as Phill Fox mentioned, only the icon/avatar for multiple projects is a little different.
This happens whenever your board filter refers to multiple project names, either in "project =" or "project in" clauses.
You can actually have a board inherit an icon, yet pull from multiple projects, if those extra projects come from other criteria, e.g.:
project = 'TPS' or reporter = 'blumbergh'
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