I know this topic is actually old, but i am having this same problem and i see no answer.
Does anyone has any idea of what the problem might be?
I've been checking in Google, but i cannot find a solution for it. I've found this:
http://forums.phplist.com/viewtopic.php?f=6&t=23394, but it does not seem to apply for ASP.
Regards.
Having the same issue myself. For now I'm working around it by just manually FTPing my images to the server and linking them up, but it would be nice if the upload worked right.
I assume it may be some sort of permissions issue, but haven't managed to track it down yet.