The upload should work also installed form the desktop.
If that won't fix it... I'd suggest backing up the data on your Mac, and doing then an erase and install. Getting everything back set up as they were after will take a while, but considering your hard drive size, spending any space in useless archive and install would be just waste.
Have you thought about replacing the hard drive with a bigger one (they are way cheaper nowadays than when you got you Mac)? 100-120 GB would probably be plenty of space for your needs, and would make the Mac usable way longer. Another option would be getting an external hard drive for your files.