I have the same issues. I have visitors can upload files set to yes in the properties of the album & the group (registered) can upload pictures. I created a test login & I still can't upload. If you care to take a look, My gallery is at www.intcoa.com/coppermine/index.php & the test login & pass is test & 1234.
Where did you get your version of Coppermine?
I downloaded it off your site yesterday. I actually figured it out. I created a new catagory called public, used the admin section to create a new gallery, then it worked.