I have lots of images in my Pictures folder that I wouldn’t want to use as wallpaper. So I like to keep a separate wallpapers folder. But selecting from that via the standard Unity interface is a bit of a pain. I like to look at all the images at a reasonably large scale and choose what I feel like at the time. The answer is in http://askubuntu.com/questions/808736/set-as-wallpaper-right-click-option-in-nautilus-does-not-work.
gsettings set org.gnome.settings-daemon.plugins.background active true
gsettings set org.gnome.desktop.background show-desktop-icons true
xdg-mime default nautilus-folder-handler.desktop inode/directory