An update already on the feedback from I.S. This from Chris:

For the file upload limit, it seems I missed “post_max_size” in php.ini. If I set this to 10MB, this will raise Moodle’s value as soon as we restart the web publishing service.

There are actually 4 levels in which a maximum upload size can be set

– system level (php.ini)
– moodle level (admin->Config ->Site variables->maxbytes)
– course level (Course settings->Max Upload Size)
– activity level

This allows for finer control over certain areas.

Chris