See this previous thread from the last time you asked a very similar question.
Thanks a lot for pointing me my last query-post.
However I actually posted this after going through the post http://www.designers-guide.org/Forum/YaBB.pl?num=1170976620/15 .
It seems that by increasing the No. of Harmonic in PSS improves the IIP2 or IIP3 values ( if they are really high. i.e. the IM2/3 components are very very small)
As Tawna said, you didn't mention whether you are using harmonic balance or shooting. With harmonic balance, if you don't have enough harmonics to represent the harmonic content of the signals, the energy from the missing harmonics can leak into the harmonics you've chosen, compromising the accuracy. With shooting that doesn't happen because it is simulated in the time domain, but it tends not to be so good at simulating circuits with extremely high dynamic range (such as IIP2/IIP3 simulations where the input power was low).