In the Edit Categories' "Usergroup Access Permissions*", check the first settings for "View" only; the other settings "Upload", "Post" and "Vote" are left blank. More than likely you've done that, so...
In IE it won't give you that option to upload in a unauthorized category but in Firefox it will, or so it seems; the photos end up in "All Member Galleries" and not in the unauthorized categories. That's the case for me, anyway.