Error while attaching files to new message. Please advise.

Common problem with attachments is insufficient permissions for attachments folder which is located in the data folder. Please refer to this topic to learn how to grant necessary permissions.

Also, if you use IIS 6, size of a file that can be uploaded onto the server is limited to 200K by default. You can increase this limit according to you needs. To do this, type "notepad %WINDIR%\system32\inetsrv\MetaBase.xml" in command line, search for the "AspMaxRequestEntityAllowed" property, and specify necessary size in bytes, then save this file. Please note, "Enable Direct Metabase Edit" must be turned on, in other case, you will be not able to edit this file. To check this option, look at your web host properties in Internet Information Services (IIS) Manager.

Additionally, you should try adding httpRuntime tag with maxRequestLength value set in web.config file under system.web:

<httpRuntime maxRequestLength="8192" />

The value is set in Kbytes, so it equals 8Mb. Of course, you can specify any other value.