I'm starting to think this is a bug since SQLFORM calls store() like this:

store(f.file, f.filename)

I could do the same thing in my code, but the documentation I've seen so 
far only requires you to pass one parameter to store(). So, if the DAL was 
changed to look something like this (starting at at line 5555):

        dest_file = open(pathfilename, 'wb')
            try:
                if isinstance(file, cString.StringIO):
                    shutil.copyfileobj(file, dest_file)
                else:
                    shutil.copyfileobj(file.file, dest_file)
            finally:
                dest_file.close()

That would probably solve the problem.

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