You guys are awesome! Finally got it! For future people, this is what I did. Esmi, the splitter you told me about never worked, but below you will find I found a simple easy one that worked like a charm. This whole thing is such an easy process when you know the details. Couldn't have done it without the two of you...
Here's what I did...
1. Installed WP to my server with an APP my server provided. They also did it for me after I did it originally, to make sure I did it right. It's easier for them to do because they changed the index page name and ensured that everything was prooperly done. My server did it for free. I suggest you e-mail your server and find out what the procdure is. I love my server - it's IXWebhosting for anyone who is interested and this is not a paid endorsement, haha! Their help is always free 247, which is amazing.
2. I requested that they enlarge the file size and memory. They did.
3. I exported an XML file to my desktop via my wordpress.com dashboard > tools > then export.
4. I went to the link below to download and run a free splitter.
http://www.hongkiat.com/blog/split-large-xml-for-wordpress/ It was easy peasy.
Note: I had to split mine in to 7 files that were .7 MB in size to get all the files to copy to my new domain. I originally made them 2 KB, then 1 KB, but I was still missing some info. I think with .7 KB you are safe. Apparently, wordpress importer only downloads files less than 1MB at a time.
5. I signed into my new site via an admin link that my server sent me and went to the dashboard > tools > import. I clicked on the wordpress link, downloaded the 1 of 7 file that the splitter made. I changed the author to my new username and click to attach files. Make sure your tab stops spinning before you move on to importing the next. It takes just a few minutes for each file. I did this for all of the files and VOILA - it worked! xo