"We have automated course backups nightly and luckily the course we were trying to Import was backed up last year, we could Restore the content surprisingly (without student data). Cant understand why the backed up archive of the course (has student data) would Restore and could not Import same course."
Some thoughts ... you have something to compare now if you were to un-compress both .mbz files into separate test directories and then compare xml files. A no users backup would not have assignments that were turned in by students, the other would.
You are attempting restore via GUI, but have you tried restore from CLI? In code/admin/cli/ there is a restore_backup.php script. Takes web service and anything in front of the web service out of the loop ... just php talking to DB then.
Yes, those variables/settings had recommended settings, but I have had to increase those (both) with problmatic courses (very large 130 Gig!!!!) and attempting to use GUI was really just not possible!
From a Google AI (check the ones you might not have tried):
Troubleshooting the restore process
If a restore process gets stuck or fails, the temporary tables can provide critical debugging information. Looking at the mdl_controller_content and related tables can help you pinpoint the specific item causing the problem.
To debug a restore failure:
Enable developer-level debugging in Moodle's Site Administration settings. This will show more detailed error messages during the restore.
Examine the Moodle logs and web server logs for error messages.
Inspect the temporary backup folder in your moodledata/temp/backup directory. The controller creates a directory with a unique hash name for each restore.
Check the temporary database tables directly using a tool like phpMyAdmin. The temporary tables persist after a failure, and you can query them to see which item the controller was attempting to process when it stopped.
'SoS', Ken