Try and bypass iPhoto (apple did make changes to iphoto recently).

Open iphoto and drag the image you want to upload to eBay onto your desktop.

On the Sell Your Item Form select upload photos > browse.  Select Desktop from the top middle of the page and find your pic in the list. Highlight it and select choose from  the bottom right.

Try uploading the pic. If it works it will tell you that iPhoto is the problem.

Pete