I have noticed that on some servers with apache and php with safe mode enabled, you are able to create dir but not move a file or create a file in it.
When the dir is created it is created with UID Apache and script UID can not write to dir under safe mode.
Warning: SAFE MODE Restriction in effect. The script whose uid is 516 is not allowed to access /home/farinspace/ebay/kiitay/ah/uploads/test4_1025938378 owned by uid 48 in /home/farinspace/ebay/kiitay/ah/output.php on line 125
do you get the above error if you try to write to the dir...