Ahhhhhh. Changing the setting there does not change the current setting, What you've done is changed the default behavior when FlashFXP starts up.
To change the current transfer mode you need to change it via the toolbar (it's a custom button, you may need to activate it by right clicking on the toolbar and selecting it) or via FTP > Transfer Mode.
I took a look in the help file and I see that this is not explained, we'll update the help file to include this information.
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