I have UseDirectoryIfExists set to True, but it errors out as it tries to create it. If I set it to False it gives me an "X" saying it "Can not create a directory. User chose to fail the task if directory exists" and the package doesn't run so my only option is setting it to True.

Is this supposed to be the case?

I have the IsSourceVariable set to False and using a SourceConnection Path that pointing to the folder above (well, with the dynamic variable dating of the folder in the path).