If you have upgraded your magento or coppied it across from dev to live or live to dev you may find that Magento connect is throwing “Local file doesn’t exist:” error. This is generated from lib/Mage/Connect/Ftp.php. The error occurs if you have oped to use the new ftp connection method for magento connect. This is a long sought after method of using connect but this is the down side. Rather than store your ftp date in the database the Magento team have opted to store this info in a file… downloader/connect.cfg to be precise.

This is a text file which you will see contains the info you used when setting up Connect. Make the necessary changes to this to reflect the new server location.