The problem is with flash 10 that seems to be incompatible with mod_security. This caused the flash player to fail which result in an Upload Error: 500 on SWFUpload. The other thing that also might caused it to display Upload Error: 500 was the file limit set on the server.
Did a few search on Google and the most helpful link i found was actually in the SWFUpload forum,
There are a few ways to solve this problem but all of them are pointing at fixing up the server. You guys can try the following ways to fix up this problem.
1. This is what my client host service done on their server. They off the following things in their server.
SecRuleEngine Off SecRequestBodyAccess Off
2. turn up the upload size of your web server.
<ifmodule mod_php5.c> php_value upload_max_filesize 100M php_value post_max_size 100M </ifmodule>
3. You may also want to add these settings on your .htacess file. Although these doesn't work for my client but it does work for some of the people out there.
SecFilterEngine Off SecFilterScanPOST Off
4. Sometimes size limit also gives you problem so you may want to try increase the size on your php.ini
5. Turn off mod_security which might not be a good idea.
6. Direct your files into Amazon S3 to solve server issues