Thanks, I think you're right. It's clearly counting markup. In order to make the needed changes, I cut some words and, using a character counter, confirmed that the entire markup character count was under 5000. Still didn't work, same error. I cut more and more, and eventually it updated. This seemed to have nothing to do with images, in my case, and the actual count was closer to 4000 than 5000. It must be counting characters that I can't see, somewhere.
Random unsolicited advice to Itch: please post the rules somewhere. How many characters do we get on our profile? (Forgive me if this is posted somewhere. I looked but couldn't find it.)
Anyway, crisis averted, for now! Best of luck, Gendgi, with uploading your images.