You should have the latest version of Gravity Forms installed and running. This version of the add-on was tested with Gravity Forms 2.1.
If you get a “directory already exists” error message, you will need to use FTP to upload the updated plugin to the folder that already exists. Check with your hosting provider for instructions on how to use FTP to upload files. Please make sure you “unzip” the plugin files before uploading them via FTP.