At the very least, Radio Shack should be able to tell you if there are any 'known issues' with the camera system.
I would suspect that, as the images are in the camera, but simply won't upload - that it is a software issue. I have run into this several times over the years, with several different digicams - usually right after Microsoft issues a batch of 'patches' for Windows (like they have recently with 'Service Pack 2', which is causing a LOT of problems).
My experience in these cases has varied. Sometimes, you can simply uninstall and reinstall the software package. Sometimes you have to get an 'update' from the software company. And sometimes, you have to uninstall the latest Windows patch.