Can you please explain webservice?
a webservice exposes a function or sub on your webserver through code (that you wrote) to process something. So a Windows Application can be scripted (or server side with PHP or ASP) to be able to upload/process the file.
However, you'd need a Windows Server for that (not sure PHP has web services?)
Anyway, to your question. If it's small, it wouldn't matter if you use FTP or Email. Your receiving end would need to process it still, and unless you're running PHP and have a Cron job setup to process the FTP directory it will be uploaded to (or have a custom POP3 service running on the server, which means PHP/Cron to periodically check an inbox for new incoming files to process) I don't think it's the best way to do this.
I reckon, a simple "Admin" login with the ability to upload the file. Once they click submit, you can then process the file without having a cron job on there to check it (assuming you use PHP, if ASP, it's tougher as Windoze doesn't come with a nice cron job feature you can setup without having to RDP to the server and schedule one manually... which would be impossible if the hosting is shared)
there's a million ways to skin a cat. so it's up to you to decide (and tell us) which technology/your programming ability and status of server host before we can suggest the best solution
You can even ZIP the file if it's text to make it smaller than 10k and then process the ZIP file automatically server side.... pretty nifty thing this programming gig
