I have been working with WordPress for a couple of months now and I encountered a problem where I wasn't able to upload images to WordPress or create wp-config files on domain's that my school provides.
After working on the problem for a few hours I was able to trace the problem to my directory not having the proper file permissions, and how WordPress names it's directories.
When I first encountered the problem wp gave me an error message stating it was "Unable to create directory /wp-content/uploads/20011/10. Is its parent directory writable by the server?"
Immediately, I thought in order to fix this problem I should change the file permissions on wp so that it can write to the server. I used winSCP (or any other FTP/SFTP client) to log on to the server and change the permissions by right clicking on the Directory, heading to the Properties/CHMOD and changing the permissions to 777. Sadly, this method did not work. I encountered a similar error message but stating "Unable to move directory /wp-content/uploads/20011/10."
Luckily I was tinkering in the media settings of wp and I discovered that the directory for media uploads is misspelled. The error message said it was the directory /wp-content/uploads/20011/10, but in the media settings the default directory is wp-content/upLoads. It has a capital L in loads. I renamed to directory to upLoads and it works perfectly fine now.
I don't know if anybody else has encountered this problem but this is what I did to fix it. Again, in order to fix this problem make sure that WordPress has the proper file permissions and the directories are named properly.