After many fruitless hours of scouring the forums I finally found the problem and solution. If you are using a router be sure to set-up Enable WAN Ping Respond, in the advanced settings. I reviewed my wireless router's logs and found that it was blocking ICMP Type 3 packets from Apple's server. As a result, it would give the message, "An error occurred while uploading one of your files. Please check your network connection and click Retry to resend your file." You can find the blocked packets in your log based on the time you clicked the buy button for your iPhoto purchase (in my case about a dozen times). If your packets are blocked, then that is your problem.
I should have suspected it was the connection since the message plainly said, "...check your network connection...". However, I discounted this along with so many others based on the forums, since I could connect to the internet. If there only was a way the message could have gave a little more saying, "Enable your WAN Ping Respond now, or else!"
Good fortune on your road to Macenlightenment!