When you\'re uploading images, there\'s a link to the following;
Allowed extension groups and their sizes
Images -> Maximum Upload Size: Unlimited
gif jpeg jpg png tga tif
Judging by that, you\'re allowed to upload an image of any size. But i\'m guessing Mike has restricted this, in a bid to cut down on bandwidth for the site.
Either that or it is a generic message for any unsuitable upload - for instance are you uploading a BMP file?
Best bet in either instance is to probably register for a Photobucket.com account, and upload you\'re images there. Automatic resizes, and can store loads of images for free - and doesn\'t use up SSC bandwidth.