Full-Size Images Not showing up but Thumbnails Are

I’ve run into a strange image issue that I haven’t found a solution to by reading the threads so far. I’ll see if I can outline the problem:

1. I upload image.png through the media uploader.
2. image.png appears fine in the gallery. I attempt to insert image into post or use as featured image.

3.a. If using the full-sized image, image.png appears broken.
3.b. If I edit image.php, rotate ccw 90 degrees and then cw 90 degrees for example, and save it, the image appears.Note: this saves the image with a new name. image-e13399…png.

4.a. If I use the thumbnail or medium version of image.png, the image appears.
4.b. These images are auto-generated, and named image-100×100.png, etc.
4.c. If I link these images to the original image.png, clicking on the image brings up a 500 Internal Server Error.

So, what I’ve gathered so far is that, for whatever reason, links to the original uploaded file do not work. Any changes to that file that result in a new filename, (Example: from image.png to image-100×100.png) allows the new image to be seen.

Thing’s I’ve tried:

• Checking to see if images actually upload. They do.
• Used multiple browsers. Not browser specific
• Flushed browser cache and w3t plugin cache
• Switched themes to Twenty Eleven–problem persisted
• Deactivated all plugins–problem persisted
• Checked media settings–default upload path, etc.
• Checked PHP versioning — 5.3.14

Summary: image.png bad. image[any_other_text_added_by_changing_image].png good.

This problem occurred after upgrading to 3.4. Upgrading was done by my host.

I’m at a complete loss as to what’s going on. Any help would be appreciated.