AOL has (unintentionally) screwed us over by disabling folder transfers on all AIM versions 5.9 and below. After back and forth emails with a VP of AOL that we’re acquainted with, we were told that a “security flaw” in the old versions was the cause of the changes.
Now, only users that are on the new 6.0+ versions of the AIM client can receive file transfers of directories. (Anyone can still send, but only AIM 6 users can receive.) That functionality has been disabled for all users on older versions of AIM (including DeadAIM, GAIM, Adium, and Mac AIM).