Here is a quick update and solution to this problem.
It turns out there are three places that need to be updated in order to allow large file uploads.
1: PHP INI (as mentioned earlier)
2: IIS 7 Configuration Settings (also mentioned earlier - this is also a PER site setting)
3: FastCGI Settings (when you are using FastCGI to process PHP, like I am)
In FastCGI, "Activity Timeout", "Idle Timeout" and "Request Timeout" all need to be increased accordingly.
One I increased teh FastCGI setting, I was able to upload a larger file without any issues.