Thanks for your patience while we figured out the permission issue in the Photo Album. All has been fixed. Users may once again upload images. The problem was that unregistered users were getting the same permissions as users, thereby opening the door for spamers. With the help of the photo album designer I found the piece of code causing the trouble and we're now back in business. As a sign of appreciation for your patience, I've bumped up with upload limits a tad.
Sorry for the inconvenience.. and that it took so long to track down. Enjoy.
PC