Hmm... familiar feeling. I'm overweight, riding 45x16 on a mostly flat commute, vary b/w fixed and free for longer rides. Hills can be HARD going up and scary going down.

I find longish moderate hills to be the best for building up - enough to make it hard work the first few times, but to see progress over a few weeks. Repeat several times, then rest, then another 2 sets, then stagger home and stretch before collapsing in a painful heap.

I' lucky to live in the world's best cycling city with everything from 50km flat rides, to 8km of constant 6% uphill, to 12% torture tar all within 10km of home!