What worked for me:
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In WordPress Misc. Options, allow file uploads and use the recommended directory destination but add the directory /photos. Make sure your max upload file size is big enough to handle your photos. The URI of the directory field in Misc. Options should be the same as upload paths in Image Upload settings of Photon.
Create the /photos folder in the wp-content directory. Change the chmod of the /photos directory to 777.
After changing the setting in Photon click save and then quit iPhoto before trying to export again. It wasn’t saving my setting changes when Photon crashed.