hold on, are you using power gallery 1 or 2? the ability to ftp directly to the gallery folder is only available in PG2.
if you are using PG 1, it is more likely a server memory issue. it may that the 11 image is rather large and causing the server to fail on generating the resized images.
does it always fail on the same file? if so, try resizing that file in Photo Shop or another image editor first.