I have found the root cause of the error and need a fix.

It appears that the temporaryFolder is not implemented the same for Silverlight and Flash.

The flash uploader sends files to the handler and the handler does not assemble the files in the  temporaryFolder until the post is complete.   The uploadhandler for silverlight assembles the file directly in the temporaryFolder.

This can be reproduced by disabling silverlight plugin in firefox and uploading any large file using Flash.
The File is not copied to the temporaryFolder until the upload is complete.

The ISSUE with this is that the app_data/RadUploadTemp folder on some hosts (Azure) is limited to 100 MB so the upload fills the temporary storage and raises an error "DISK FULL" which in turn causes a recycle of the application pool to purge the temporary storage.

I need a fix for the Flash Upload Handler to use the TemporaryFolder the same way Silverlight does.
I have not tested the case when flash and silverlight are not available but if the ajax uploader also uses the default storage rather than the TemporaryFolder property then that should be addressed too.
 
Please advise asap! I already have a support ticket open on this but need a quick resolution.

Hi Jed Horovitz,

We have already answered to your query in the support ticket opened. I suggest that we continue the conversation there, since I believe it would be easier to follow each other If we write on the same place.

Best wishes,
Genady Sergeev
the Telerik team