Categories not being found (page not found error)

Hey Guys, pretty familiar with wordpress so I am not sure why this latest install is having problems. I will appreciate any help you guys can give.

I can post and the post shows up on the main page, when I change the permalinks, the directories are not being created on my server

This is the structure i use on past blogs and it always works, just not today /%category%/%year%/%monthnum%/%day%/%postname%/

This is on a server that works on all other installs. Even the default “uncategorized” shows up with ‘Not Found’ I double checked permissions and that does not seem to be the problem.

The wordpress install is located in my root directory domain.com, it is also where I have my vbulletin forum for the site, does anyone have any experience in regards to this problem?

I am including my htaccess below, if anyone sees a problem that I am overlooking.

RewriteRule ^((urllist|sitemap_).*\.(xml|txt)(\.gz)?)$ vbseo_sitemap/vbseo_getsitemap.php?sitemap=$1 [L]

RewriteCond %{REQUEST_URI} !(admincp/|modcp/|cron)
RewriteRule ^((archive/)?(.*\.php(/.*)?)?)$ vbseo.php [L,QSA]

RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteCond %{REQUEST_FILENAME} !^(admincp|modcp|clientscript|cpstyles|images)/
RewriteRule ^(.+)$ vbseo.php [L,QSA]

# BEGIN WordPress
<IfModule mod_rewrite.c>
RewriteEngine On
RewriteBase /
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteRule . /index.php [L]
</IfModule>

# END WordPress

thanks!