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. . . the Batchthumbs program is being a real PITA.
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I ran into the same thing. In playing around with the program I discovered that it worked fine if I converted no more than around 220 images at a time. Instead of selecting the entire file to convert at once, go into the window that displays the list of jpeg images and click/drag/select smaller groups of them, like maybe all the a's through c's, then all the c's through e's, etc. Convert them in smaller batches like this and it should be okay.