Do you know what OS and/or FTP software the FTP server is
running? This could be a server specific bug of some sort.
Regarding your "is it atomic" question: rename is implemented
by two lower level FTP commands on all servers I'm aware of.
first an RNFR is sent by the client to the server. If
that succeeds, then an RNTO is sent.
You say the target file is there even when you get the
error. How about the original? Is it still there? It
may be that the way the server implements rename, it's able
to create the new file but not remove the old one, although
that seems pretty unlikely if you put the original one
there. I have seen some flaky NFS mounted disks give a
"no such file or directory" error when they hit other
issues.