When you say it said "jpeg", are you just saying that the image file had a jpeg extention, or was this part of an error message. If it was part of an error message, what was the full text, and did it occur before or after you clicked on "Upload Avatar".
God bless Internet Explorer. Whatever would I do with all my spare time were it not for this browser.
This is fixed. You should be able to upload your avatar now. I'd appreciate it if you could play with it a bit, upload a different image, then upload back to the one you want.