I think I have installed 1.7.4 correctly. I have setup a category successfully and added pictures from a URL. However, when I try to upload from my local machine, my browser throws an error "The connection to the server was reset while the page was loading."
I suspect this is related to my hosting company (awardspace.com) as I've had a ton of problems with setting up other software (what do you expect for free, right?)
At first, I suspected directory permissions, but went back to the install docs and verified I changed the following directories to 777:
data
data/database
data/media
data/thumbnails
data/tmp_media
data/tmp_thumbnails
I have tried to upload both through the index.php and admin/index.php with the same error.
What is different about uploading from a local computer and loading from a URL?