Here's a little gem I've used in some of my applications:

        Microsoft.Phone.Tasks.PhotoChooserTask t = new Microsoft.Phone.Tasks.PhotoChooserTask();
        t.Completed += t_Completed;
        t.Show();

        ...

        void t_Completed(object sender, Microsoft.Phone.Tasks.PhotoResult e)
    {
        try
        {
            var req = HttpWebRequest.Create(new Uri("http://windowsphonehacker.com/upload.php", UriKind.Absolute));

            req.Method = "POST";
            req.ContentType = "application/octet-stream";

            req.BeginGetRequestStream(callback =>
            {
                Stream poststream = req.EndGetRequestStream(callback);
                var reqWriter = new StreamWriter(poststream);

                byte[] buf = new byte[e.ChosenPhoto.Length];
                e.ChosenPhoto.Read(buf, 0, (int)e.ChosenPhoto.Length);

                string data = Convert.ToBase64String(buf);
                reqWriter.Write(data);
                reqWriter.Close();

                req.BeginGetResponse(rep =>
                {

                    WebResponse reply = req.EndGetResponse(rep);
                    Stream str = reply.GetResponseStream();
                    StreamReader reader = new StreamReader(str);

                    //success!
                    System.Diagnostics.Debug.WriteLine(reader.ReadToEnd());

                    this.Dispatcher.BeginInvoke(() =>
                    {
                        //do something to the UI thread
                    });

                }, null);
            }, null);

        }
        catch
        {
            this.Dispatcher.BeginInvoke(() =>
            {
                MessageBox.Show("An error occured!");
            });
        }
    }

This will upload the image stream as base64 encoded POST data. To read it on the server, do something similar to the following:

        $data = base64_decode(file_get_contents("php://input"));

Easy. Which is often typical (though sometimes very much untrue) of Windows Phone development and C#. Enjoy.