Uploading from local Server

Hey guys, I am having a lot a issues with batch uploading, My client is uploading over 3500 at one given time using aperture. however this crashes our server. We have increased the php memory to 64mb.

The option i have come across is ftping images to a folder at the permissions of 777. but when i use the upload for local server module it says server does not have permission to read this directory (something of that effect) any ideas?

Desperate help needed.