When we try to upload files the max limit for uploads is 2mb.
I searched the web that told me to create an php.ini file and drop it in the wp-admin folder so that I sould change the file size. The code I was given is:
upload_max_filesize = 250M;
post_max_size = 250M;
I duly created the php.ini file and uploaded it to the wp-admin folder but my file size is still set at 2mb. Is this something in the theme that is conflicting with the php.ini file?
Create a new thread and tell me what problems you are encountering and what you want to know. 
There is no step 3 :) 
