This one had me stumped for ages too! I'm running Win 7 64, and could not accomplish this with Chrome or IE so I presumed it was not a browser issue. I also tried Chrome and Safari on MacOSx with the same issue. Thought perhaps it was not possible, however when I opened my DSM it worked like that out of the box so it had to be a change in my environment. Here's all I did to resolve:
1. Uninstalled java. (Control Pansl > Add Remove)
3. Reinstalled Java.
4. Ran the 'uninstall old java versions' tool http://www.java.com/en/download/faq/rem ... rsions.xml
6. Installed the ActiveX plugin for Chrome.
Now I honestly dont know if it was the java or activex plugin, but my suspicion is Java was the culprit. When I choose 'Upload-Overwrite' I notice the header of the dialogue box has the java icon.
Hope this helps!