ok I have adapted the code im using to do what you wanted (strip white space AND make lowercase): Here is my code for you to compare to yours:
$WA_UploadResult1_Params["WA_UploadResult1_1"] = array(
'UploadFolder' => "../../images/banner/",
'FileName' => "".strtolower(str_replace(" ", "-", (((isset($_FILES["fileupload"])))? preg_replace('/.[^.]*$/', '', $_FILES["fileupload"]["name"]) :""))) ."",
'DefaultFileName' => "",
'ResizeType' => "0",
'ResizeWidth' => "120",
'ResizeHeight' => "120",
'ResizeFillColor' => "#FFFFFF" );
// WA_UploadResult1_1 End
// WA_UploadResult1 Params End
?>
<?php
WA_DFP_SetupUploadStatusStruct("WA_UploadResult1");
if(isset($_POST["Save"]) || isset($_POST["Save_x"])){
WA_DFP_UploadFiles("WA_UploadResult1", "fileupload", "0", "", "JPG:100", $WA_UploadResult1_Params);
}
?>
Regards
Chris