I tried to upload an image, but was flagged by the "must be under 200KB" message.
My computer lists the size of my .jpg as 198kB when my mouse hovers over it (and lists as 199kB in the file detail information).
When using the StampCommunity "Image Resizer" utility, the original .jpg size is identified as 198.99KB (686px x 427px) and it resizes it to 102.06KB (857px x 533px).
So, there appears to be a limit under 200kB that files cannot exceed to be uploaded, less than 200kB.
This shouldn't be an issue any more.