Could not create directory /wp-content/upgrade/

First do not use 777, change it back to 755.

Second you need to add the proper group permissions most likely to the same that Apache is running under.
To find that out try:

ps aux | grep apache 

You will see the Apache user group on the left.

Now change your WordPress folder to the same user group, you can do this in a parent folder or sub folder but for sanity it usually best for parent folder, use -R to recursively do it.

chown -R www-data:www-data /path/to/wp-root-folder

• To login on windows use Putty
• Enter your hostname and port
• Choose connection type depending on server settings
• Click open

If you try to chown and get denied you will need root privileges , type sudo su and your password.

ps. It would help if you mentioned what OS your server is running and if your running a php permission script like suPHP.