Double check that the imagesupload folder allows Read and Write for all users.
You can check this in Dreamweaver:
In the Files Panel, change the View Dropdown list to Remote View.
Select the imagesupload folder, right click on it and select Set Permissions. The permissions should be set as:
Owner: Read, Write, Execute
User/Group: Read, Write
Everyone: Read, Write
Another thing to try is adding the following code to the admin/Products_Insert.php and admin/Products_Update.php pages at line 1:
php:
<?php
ini_set('memory_limit','256M');
?>
