Found this a the Microsoft site. It fixed the error and got me read/write access.
ERROR MSG: The folder 'ftp://ftp.site.name/' is read-only because the proxy server is not set up to allow full access.
RESOLUTION
To resolve this issue, disable the Web-based FTP option. To do this, follow these steps:
1. Click Start, point to Settings, and then click Control Panel.
2. Double-click Internet Options.
3. On the Advanced tab, click to clear the Enable folder view for FTP sites check box, and then click OK.