Hi,
Besides permissions, I don't see any other reasons why it would not be able to copy the file in that folder.
You can try to setup the FTP layer of Joomla in order to avoid the problem:
www.joomlainformation.com/joomla-tutoria...e-ftp-in-joomla.html
If that still doesn't work with that method. Then, you can manually upload the files via FTP in that folder and link them with the products via the text area import (menu Products->Import) like that:
product_code,images
my_prod1,myimagename1.jpg
my_prod2,myimagename2.jpg
...etc...