i googled your plugin and it looks like (in some cases wp 2.8...) it needs more then 32 mb of memory to run and even though you increased WP_MEMORY_LIMIT that doesnt mean that your host allows ini_set in php (that means that you cant increase your allowed memory limit).It might be a problem with the script too and i do think it can be optimized to use less,but that is their problem...sorry.
Check their forums..
http://www.instinct.co.nz/forums/
sorry i couldnt be more helpful.
Cheers mate!