Did you ever get this figured out? I'm have a very similar or same issue.
In site settings if I set the upload directory it's ignored and then even changes to something weird that I never entered in the first place.
For example if I navigate to the "files" directory I created in my "CMS" directory, I get this to start with. /CMS/files . I save and then upload the configuration.php file in the kfm directory.
Then I open the HTML editor settings for the form and I enter /editorimages under General>File-Upload>Sub-Directory . Save and upload page.
But when I use the form and upload an image it ignores my site settings and creates a directory at root /editorimages and the image is placed there.
Ok back to the "weird" changes that it makes in site settings. If I open sites settings back up, I see webassist/kfm/CMS/files sometimes. Once I had webassist/kfm/CMS/files/webassist/kfm/CMS/files/webassist/kfm/CMS/files or something like that. Didn't right it down but it was repeating the same thing.
I haven't messed with HTML editor's file manager for a long time and might be missing something.
The help and getting started guides don't have any examples of directories typed into their screenshots but I am pretty sure I have it right.