From Joomla! Documentation

There have been reports that updates with the FTP layer enabled are not working. Currently there is not a fix for this, but it is suggested that rather than use the updater you install the new Joomla version using the standard extension manager install. If that does not work, you can ftp the update zip filed to your host and unzip the new files, replacing the old ones. You will need to manually run the database changes using the appropriate version script found in administrator/components/com_admin/sql.

You will also need to manually delete the Flash uploader files from the media folder.