When I change the file type from File to Image, it doesn't move the file, so you then have a broken image. I think it would be reasonable to try to move the file to the right directory (if it is a valid image type) and to move the original file if changing the type the other way.
http://test.dwagn.org/test_file - image was uploaded when the cardtype was file, now it's image.
It looks broken right after you save, but if you refresh you'll see the image. Not 100% sure that means this is a non-issue... --John Abbe
Hmm, I'll have to look to see what's going on. There's not a separating directory pattern for images and other files; it should be ok to keep it in the same place.
oh, I think I get it. when you upload an image, it actually creates all the image variants (icon, small, etc). that whole process doesn't get triggered.