Basically here that I see thats a permissions error meaning permissions are wrong on your data directory or there is an issue with the imagemagick install.
GD2 works but sometimes it hangs. It also hangs for file above 3 Megabytes.
If I add images I first shrink them with a little very useful program but it tends to hang on large files or multiple image submission. I have a dedicated server so memory should not be an issue
Thanks Chuck
Paolo
GD2 is known to have issues with larger files sure. You can increase your PHP memory to 40 or 48 meg to see if that helps but if GD2 works for uploads this seems to single out an issue with your imagemagick install since uploads do work with GD2.