Faults in cylindrical roller bearings are one of the main contributors to major faults in rotating machinery. The development of bearing fault diagnosis technologies is key to measuring the performance, status, and risk of failure of rolling-element bearings and has attracted extensive attention from industry and academia. When faults arise, they are often not a single fault but a compound fault, such as the simultaneous failure of the inner and outer races. In this paper, a method for evaluating the size of compound faults on the inner and outer races of cylindrical roller bearings is proposed. The dynamic modeling method developed by Gupta is employed to create a dynamic model for compound faults on the inner and outer rings of rolling bearings that allows the time domain signal of the vibration responses of compound faults on the inner and outer races to be obtained. Adopting an improved continuous harmonic wavelet packet decomposition method for the decomposition and reconstruction of the compound fault signal, we arrive at the corresponding single-point fault signal. The relationship between defect size and key metrics of the vibration, such as root mean square acceleration (RMS), peak, crest factor (CF), kurtosis, and level crossing rate (LCR), is investigated. The results show that there is a strong linear correlation between LCR and defect size, which can be used to evaluate the size of the defect. Experimental data for cylindrical roller bearings with compound faults on the inner and outer races are examined to verify the results.