The latest version of upload progress module is 0.8.2 so you should upgrade to that to begin with. If that doesn't solve the problem then I documented my install and progress bar here: http://blog.martinfjordvald.com/2010/08/file-uploading-with-php-and-nginx/

That's almost exactly the code I have in production working just fine, so maybe you can use it as a reference to see if you are missing anything.

Cheers,
Martin Fjordvald