Please help me understand text editing

One of the big frustrations I'm finding is difficulty in basic field editing but I'm sure there must be some techniques that I'm missing?

Here is an example, today I wanted to download an email attachment so I went to "Open Attachments" and selected "Download Attachment" from the menu, once I selected the folder I got the rename prompt (I already had a file of the same name in the folder and for reasons known only to RIM there is no overwrite option).

Now I am looking at the rename dialog, the existing name is highlighted and I have the "select" cursor.

How do a change one letter of the name? clicking in the field does not exit select mode, there is no menu on this dialog to exit select mode, clicking where I want to insert the character (or as close as my finger can get) simply changes the end point of the selection, hovering does nothing, swiping just changes the selection, typing anything overwrites all of the selected text.

The whole thing is an exercise in frustration and I end up retyping the entire name.. on the curve I never had a moments trouble with this dialog, I would simply scroll to the position, hit the key, scroll to OK and click.

What am I not seeing?

Thanks!

(PS this is not a troll, I am genuinely trying to make the Storm work for me at this point)