I have now tried just about everything including trying to upload existing/new pictures, re-sizing, renaming and now I cannot manage my account at all. Sent Photobucket a problem report but so far I have had no reply, not even an automated one. Time to investigate Image-Shack I think!
Working again here and a reply from Photobucket support:
I am sorry for the inconvenience! The server maintenance has been completed, and you should now be able to access your account, as well as upload images, without any further issues.
Please clear your cookies and cache and log back in. Let me know if you are still experiencing the issue.
Thank you for your patience and again, I am terribly sorry for this inconvenience!