i don't think the file should be any bigger than about 90 bytes - it consists of only one line, and it's not even code. The file simply exists to test that permissions are set properly on the Members directory...
CGI files are uploaded in ASCII, but I don't think that matters in this case, since it's not code.
You're right that the file is deleted by UBB once it's through with it...
What are permissions set to on the file?
If you're positive that everything's right, let's get you into a
support ticket so we can check things out...