Why does the Mobile Safari Browser on iOS not allow file uploads?
iOS apps can only read data in their own directory and thus only Safari would be able to use these files - so how could you create them and put them in Safari's directories?

From Apple's Filesystem basics development documentation


  An iOS app’s interactions with the file system are limited mostly to
  the directories inside the app’s sandbox. During installation of a new
  app, the installer code creates a home directory for the app, places
  the app in that directory, and creates several other key directories.
  These directories constitute the app’s primary view of the file
  system. Figure 1-1 shows a representation of the sandbox for an app.
  
  Figure 1-1  Each iOS app operates within its own sandbox
  
  Because it is in a sandbox, an app is generally prohibited from
  accessing or creating files in directories outside of its home
  directory. One exception to this rule occurs when an app uses public
  system interfaces to access things such as the user’s contacts or
  music. In those cases, the system frameworks handle any file-related
  operations needed to read from or modify the appropriate data store