KFM/initialize file only sets limits for the max width and height of an uploaded image, it wont effect the max size of a PDF file.
The limits on File Size when uploading a file are set in the php.ini file, there are a number of settings that can effect the allowed file size, see the following page for more details:
http://www.developershome.com/wap/wapUpload/wap_upload.asp?page=php2
you will need to work wit hthe host to have these settings increaed to allow for the larger pdf files to be uploaded.