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Common usecase, is that user have project where the source folder is used directly with the web server. In this case the behavior of actions Upload Files / Download Files is strange. The IDE should find out, that the source folder is the same as the document path on the server. The biggest problem is that when user invokes Upload files he lost the content fo the files. It looks like you open read stream and also write stream over the same file object.
should be fixed in 6.0
fixed. committed 2007.11.20 we now check that server's document path + project's context path = project src root.