This is a good question, and fortunately it has a simple answer. Unfortunately, the answer may not be to the best of your liking.
Most web servers(commercial servers) host a multitude of sites. Therefore, they also allocate a maximum amount of server memory(ram) to be used by a specific website at any given time. When the Imagevue PHP scripts resizes an image to thumbnail, it uses an amount of memory which is proportional to the size of the image. With large images like you mention, the memory required to resize the image is often exceeded, and therefore the script fails to resize the image.
We have the exact same issue on our commercial server
www.photo.gallery, while on our private server imagevuex.inn.no(which is currently down) we have unrestricted memory allocation.
The exact limit for what dimensions you can use depends on your server and also the image details. You may find the limit is around 1280x1024, or up to 2000x2000.
Unfortunately, there is no way around this from Imagevue's perspective. The server will simply not allow resizing an image if it is too large. You do have several workaround options:
#1 Use a smaller size image =)
#2 Create your thumbnails locally for large images by making a thumbnail copy and giving it "tn_" in front of the original name. upload.
#3 The best option is perhaps to upload non-large images first, and the run the Imagevue gallery so thumbnails are created. After thumbnails are created, you can overwrite your original images with large size images, as the thumbnails are already created.
Good luck!