UPDATE: I changed the memory_limit in php.ini to 256M and then tried clearing cache again. This time it was successful with no errors.
However, when I am editing an image in an email theme and I try to browse instead of upload, it opens a new window that shows NO WAY - so clearing cache did not resolve the issue.
I also don't quite understand why the email editor is browsing to this path: /app/bundles/CoreBundle/Assets/js/libraries/ckeditor/filemanager/index.html?type=Images
Anyone having this issue? Any tips / help would be most appreciated.