Generated thumbnails don't exist

I’ve got a series of posts with Vimeo videos embedded. When I generate video thumbnails, it says it’s worked, but when checking the Post page, the Video Thumbnail displays as a broken image.

I’ve checked the path to the upload directory and the image file doesn’t exist.

I’ve done “Test Saving to Media Library” and which completes successfully.

Any ideas? I’ve tried it on a local and remote server but I get the error both times.

http://wordpress.org/extend/plugins/video-thumbnails/