If you users get a blank page when uploading it is indeed either a timeout or memory exhaustion. This is a PHP issue and the tweak provided should work and your max filesize should always be set to the max php upload size.
If anything please explain what your exact watermarking issue is as it sounds like there is no issue here at least with photopost see below
Code:
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we do not watermark thumbnails in our photopost code. You can provide a link to what you mean so we can understand here.