If anyone else runs into a Memory Allocation error then you might have some success with John Cupitt's "ptmfit" which is just a re-work of PTMfitter but considerably faster with much better memory handling. I've used it to build PTMs from 80x 20 megapixel images. It's not compatible with RTIBuilder, so you have to use it from the command line. It also doesn't come with any documentation - so be aware that your working directory has to be the jpeg-exports folder when you call it. An example call would look something like:
PS D:\Builds\E3\jpeg-exports> C:\Users\Ari\ptmfit\ptmfit.exe -i ..\assembly-files\E3.lp -o ..\finished-files\E3.ptm