I have recently just come across the same problem. when it will upload every file except executable files once i had allowed them on the Sharepoint server.
After checking and ensuring both Config files and max file size settings on the server are correct to accept the executable. This can be done by following the link directly below.
I solved the problem by changing a setting in the IIS Server (ver 7.0)
In Sharepoint Foundation the exe file is getting interpreted as a CGI to be run on the server rather than downloaded.
You can fix this by going into IIS and select the web site and click "handler mappings" then "Edit feature permissions" and uncheck the Execute box.