I got a good amount of detail on this question so hang on:
The Gallery project allows users to post their own photos to the server and to manipulate them online. It then displays the pictures in an album.
While I can upload to the Gallry by SFTP'ing the images to a temp directory, ideally you can also use the included web browser upload client provided via some PHP scripts. When ever I use this HTTP base upload method the files get truncated and jibberish is recieved. IF I upload these photos normally and then have the application render them it works fine.
You can see some results in the test gallery over at my site
Based on my snooping I have learned that when you have finished selecting the local file you want to send and then select the upload button then a form post is done and the files DOES get sent to the server albeit in a few parts and I am unsure why. When I look in the temp dir that the application puts the files in I see several files when there should only be one or two.
I've set the upload size in php.ini to be around 20M so that's not the issue as the image sizes are only typically 300-400K in size. Smaller (sub 100K) images seem to survive unscathed.
After I reset the variables in php.ini I also sighup'ed the Apache Daemon. Maybe I'll try the full stop and start and see if that has any better effects...
Any suggestions to try next?