Okay so I checked every changeable parameter for the applet in terms of max execution time, max file size, etc. and put everything way large so it wouldn't bug me, but I still have the same problem. it does not seem to be timeout though, because the length of time before the error occurs is unpredictable... could this be a problem with the applet? its freeware, so it could well have bugs.
any ideas on good reliable php multi-image upload scritps? ( I really like the aurigma.com one but its not free).