I intalled your trial module and when I select the single file option this it what I get:

You don't have permission to see the files on the site 

I am the super user/admin so I would assume that I have access, considering that I have total rights to everything on the box.

Player reads file data from your DNN database, not directly from the file system.

Please read this Knowledge Base article to solve the problem:

http://www.considero.net/Support/Knowledge-Base/tabid/2629/articleType/ArticleView/articleId/1641/Where-Are-My-Files-.aspx

Thanks!

This problem stumped me for some time, then I decided to create a sub-directory in Root.

Bingo -problem solved