Hi Earl,
By default Yummy FTP tries to make maximum use of your bandwidth, and one of the means it does so is by using 5 simultaneous connections, with the transfer load (in this case 20 files) being spread amongst them - so 4 files per connection, 5 files being transferred at the same time.
You can limit (or increase) the number of simultaneous connections via the Max Connections setting in the Preferences under the Transfers panel. If you set it to 3 then there will only be three files transferred at a time.
As for upload speed setting, it really depends on how much bandwidth you wish to keep free for others on your network, so I can't really make any particular recommendation - it depends on your particular scenario and usage. Suffice to say that your upload speed is 3.5Mbps, which is roughly 437KB/sec in Yummy FTP bandwidth measurements, then you could try at 30% to start with : 130KB/sec
Hope that helps!
-Jason