Please post in detail what the differences and server changes required for the fix, im sure everyone will benifit
also hosting companies if you dont mind

InMotionHosting had the problem; GoDady worked fine out of the box. InMotion's customer support is amazingly good. They helped identify the fix and made the switch in the \administrator\components\com_k2\lib\class.upload.php file as indicated above. Note the phrase that needs to be changed is not in line 2231, so you have to search for the file_src_mime line and then edit it as indicated.

Now it's working fine. They weren't able to answer the question as to why their servers tripped up over the native file created by K2

Hope that helps,
Andrew