When loading in IE8-9, replace the default file upload form with a fallback one.
Extract methods needed for #oldUpload out of #newUpload.
Auto-submit old upload form when a file is selected.
Correct jQuery selector.
Hide the submit button on the old upload form.
Logs for AJAX events.
Log AJAX results instead of AJAX events.
Experiment with ajax:complete event binding.
Try posting the old upload form via AJAX.
Reconfigure setup in order to log STDOUT output.

Log params sent to /upload_memory before checking their values.
Experiment with AjaxFileUpload jQuery plugin.