If your $HOME/etc/php.ini file is set to use a 124M limit, but you’re getting 32M, that may mean that this particular Virtual Server is set to use mod_php rather than CGI or FCGID.
If you take a look in Server Configuration -> Website Options, what is the PHP Execution Mode set to there?
There is an issue in Ubuntu 10.04 that caused all websites, whether they ran in CGI, FCGID, or mod_php – to run under mod_php.
That’s been corrected in newer versions of the install.sh, but if you have an older installation (or an older install.sh version), it’s possible that bug is present on your server.
Take a look at /etc/apache2/mods_enabled/php5.conf, are there any “SetHandler” lines in there?
If so, comment those out, and restart Apache. Then, try it again and see if that works for you.