Ok cool. I noticed something very strange. In my data/506 directory (the folder with the most images in it) for some odd reason I cannot see the medium, mini, and thumbs folders. Plus not all the images are showing. This happens only when viewing the directory with both my FTP clients. When i view it via cPanel, they are are there. And everything is working fine in the gallery.
This is why I could not chmod those folders to 777. I didn't see them. I did it via cPanel and it fixed the problem.