After upgrading from SP2007 to SP2010, my “Upload Multiple Pictures’ option didn’t work on any picture libraries. It would just redirect me to the “If you have not finished uploading the pictures, switch to the picture editor and finish uploading. When you have finished, close the picture editor, and click the link below.” page but not launch Picture Manager.
The fix – run Picture Manager manually from the start menu, then go Help –> Detect and Repair. Once the repair is finished it worked fine.