According to mt-check.cgi, your full server path would look like this:
CODE
$serverPathToSmilies = "/homepages/39/d76430358/htdocs/www/shogun.skodun.is/smilies/";
That's why Kristine asked you if /www/skodun.is/smilies was the full server path - apparently, it isn't.
But do I understand that Amethystique is saying it doesn't need to be a full server path? (I guess I should look at the script myself.)
Edit: The example in the script uses a full server path, so try what I posted above after all.