Follow up
The files are being uploaded. I can see the files on the server in the /cpg/albumns/edit folder and the pics are intact and not corrupt, so I'm not sure this is the right thread anymore.
Working...
Tried switching from GD Version 2 to Image Magick and it is working now. Not sure why I didn't need to do this with earleir stand alone versions ??? but the main thing is that it now works...