Try the 2.10 dev build uploaded just yesterday at: github.com/getk2/k2/archive/master.zip

A 500 error indicates a server issue. If the issue still occurs, it could be a third-party K2 plugin that is not up to date with PHP, K2 or Joomla.

Disable all 3rd party system plugins that do not belong to Joomla or K2 and then check again that page. Then, start enabling each plugin one by one until you find which one breaks the output.

Only modules are filtered for "site" and "administrator". You need to disable "Plugins" of "System" type.

First off, the Media Manager in K2 is a third-party solution integrated into K2.

Secondly, the original error indicated broken JS in the Media Manager. If the issue is resolved, I doubt it's the image size (you'd probably get a limit error if reached). One of the plugins that you disabled allowed JS to function properly in the Media Manager.

In any case, clear your browser's console, visit the Media Manager and attempt to upload a "larger" image that you said previously error-ed and see what the console outputs.