This if for security reasons, so you cannot read files from the users system using JavaScript.
If you happen find a workaround, there will probably be security patches released by browser vendors sooner rather than later. I know because in earlier versions if IE, it was possible to read the full path and hence display a preview, at least if the file was an image. I used that in a CMS UI, but of course that nifty feature was ruined by an IE service release :-/
In general the file upload control is somewhat of a "black box" for security reasons. You have only very limited access to scripting and styling it. This is so you can't snoop or upload files without the user knowing, or so you cannot trick the user into uploading files with a deceptive interface.