by the way, I can import the shape files into JOSM, but the difficulty in getting JOSM to work through firewalls etc make it a hassle to use. However, JOSM can save the imported shape files as a wsm file… but there appears no way to use the wsm file as a background in Potlatch.

I tried to use your method to upload some .shp files, and they will not upload using the shapefile radio button either as NADS or as WGS84. They do appear in the menu if I select them as GPX files… but then they do not appear in the background at all.