It uses the built-in filepicker, which already has a text-field that you can type into. (Same result as you got, just by a different means)

https://bugzilla.mozilla.org/show_bug.cgi?id=258875

And for anyone interested in how this annoyance came to be, read the conversation at the above mozilla bug-link. (Yes, I see the dates are old, but the discussion is about the "security implications" of that text entry field :/ )

Doesn't there have to be some better solution?

From what I have read, the answer from mozilla is an emphatic "No!" -- it has been disabled right inside the core of the browser, due to some security concerns.

From what I've also read, is that if you want to compile your own Firefox, you *may* be able to re-enable the old functionality, but I haven't thoroughly examined this possibility.

Google and mozilla websites show an infinite number of people complaining about the same thing since it was implemented, and IE also has made this change, for the same security reasons (believe that or not :/ ) but as far as mozilla is concerned, it's here to stay and cannot (easily) be circumvented.

Wouldn't it be nicer to disable transparency for it?

I don't understand. Disable transparency for what, where? What does transparency have to do with this?

If you cannot make the file chooser button 100% transparent, that will eliminate the security concern!

The concern is very small compared to the annoyance it proves.

Testing from IE7 (In which linuxquestions looks screwed up in).
The upload box works like it should.