It looks like you have set the File Name to use the Server File Name variable, that wont work.
The Server File name variable is created after the image has been uploaded to the server. it is based on the File Name setting and the If File Exists on server settings.
Using the server file name variable for the file name setting is a chicken before the egg type of situation.
use the default "[FileName]" in the File Name setting of the upload behavior.