(Woops, had to replace the images after pixelizing out all the identifying URL and ID information from the screenshots.)
(Woops 2, apparently I have now broken the image attachments here, so maybe I have to do it all again, sigh. Will do so later – Short version is that IE7 seems to be able to copy like this only across web applications, whereas Firefox 2.0 and IE6 seem only to be able to copy from subsite to parent site (I haven’t tried the other direction yet). Issue is now active with Microsoft support. The SharePoint support team have escalated the issue to the IE team, but I have yet to hear from the IE team.)
I have an open Microsoft Support case for this, and will update when I get more information.
In a document library in MOSS2007/WSS3.0, if you use the drop-down menu on the document, you can choose “Send To” -> “Other Location”. In the following dialogue box, you can select another location to send this document to. It seems to work in both IE7 and Firefox 2.0 if you are publishing from one site collection to another, but not if you are publishing, say, from a locked down subsite to a parent site that’s more public. In that case, the Send works fine in Firefox 2.0 but not in IE7. In IE7, you get prompted for permissions no matter who you are (or at least I do, being admin up and down the tree of sites, subsites, server farms, on the machine, using the account that runs the whole farm, etc.).
So here’s the typical functioning copy process (for a copy to other location between two site collections on the same Web Application (aka IIS’s virtual server, and specifically in this case, the same port: 80).
In contrast, here’s the same operation NOT working in IE7 while copying a file from a locked down subsite to the subsite’s parent (and top-level) site.
And here, I demonstrate that Firefox 2.0 has no problem with the same operation IE7 just failed at: