Dreamweaver MX and VSS

I'm having a problem with Dreamweaver and VSS.

We recently made some changes to VSS to remove delete permissions for the
developers, and now I am unable to create new files using Dreamweaver. The
application is creating a project in my VSS database called "CRXDQWHFA". If I
try to make a new page while that folder is prersent, I get the following error
message:

Could not complete the operation due to the following source safe errors: An
item with the name "$/FLC/fcc/CRXDQWHFA already exists.

If I have the VSS admin go into the database and remove the project, I am able
to add another file, but it creates the "CRXDQWHFA" project again. Lather,
rinse, repeat...

Also, the mystery project does not appear in "Local View" so nothing is
actually being created on the drive.

Anyone else out there run into this problem? Any suggestions on how to fix it?