Feeble, this part of profile.template.php is where the 'do nothing' message is coming from:
// If users are allowed to choose avatars stored on the server show selection boxes to choice them from.
if (!empty($context['member']['avatar']['allow_server_stored']))
{
echo '
<tr>
<td width="40%" valign="top" style="padding: 0 2px;">
<table width="100%" cellpadding="5" cellspacing="0" border="0" style="height: 25ex;"><tr>
<td valign="top" width="20" class="windowbg"><input type="radio" name="avatar_choice" id="avatar_choice_server_stored" value="server_stored"', ($context['member']['avatar']['choice'] == 'server_stored' ? ' checked="checked"' : ''), ' class="check" /></td>
<td valign="top" style="padding-left: 1ex;">
<b', (isset($context['modify_error']['bad_avatar']) ? ' style="color: red;"' : ''), '><label for="avatar_choice_server_stored">', $txt[229], ':</label></b>
<div style="margin: 2ex;"><img name="avatar" id="avatar" src="', !empty($context['member']['avatar']['allow_external']) && $context['member']['avatar']['choice'] == 'external' ? $context['member']['avatar']['external'] : $modSettings['avatar_url'] . '/blank.gif', '" alt="Do Nothing" /></div>
</td>
</tr></table>
</td>
<td>
<table width="100%" cellpadding="0" cellspacing="0" border="0"><tr>
<td style="width: 20ex;">
<select name="cat" id="cat" size="10" onchange="changeSel(\'\');" onfocus="selectRadioByName(document.forms.creator.avatar_choice, \'server_stored\');">';
// This lists all the file catergories.
foreach ($context['avatars'] as $avatar)
echo '
<option value="', $avatar['filename'] . ($avatar['is_dir'] ? '/' : ''), '"', ($avatar['checked'] ? ' selected="selected"' : ''), '>', $avatar['name'], '</option>';
echo '
</select>
</td>
<td>
<select name="file" id="file" size="10" style="display: none;" onchange="showAvatar()" onfocus="selectRadioByName(document.forms.creator.avatar_choice, \'server_stored\');" disabled="disabled"><option></option></select>
</td>
</tr></table>
</td>
</tr>';
}
line 16 in the above code. This is what its doing in IE but not in firefox. All permissions to select server stored avatar are correct.