Creating inner folders

Hi!

So I finally got it so that I can upload images (I had to correct the resource paths). I can only add a folder, however, I cannot add any folders in that folder. It says "unknown error creating folder."

Has anyone else had this problem?

I can add a new folder via ftp, but this would be difficult for some of our other users not to mention annoying.

Any help would be appreciated.

<3