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ArcCatalog does not recognize that a map cache has been created. The same behavior occurs in the Web application. This issue has been reported after a successful map cache generation or after updating ArcGIS Server to the newest service pack. Inspecting the ‘arcgiscache’ cache directory for the map service in question shows all necessary files and a complete map cache.
If the ArcGIS Desktop products, ArcMap and ArcCatalog are at 9.2 Final but ArcGIS Server is at 9.2 Service Pack 1 or higher, the cache is not recognized.
The conf.xml file structure changed from ArcGIS 9.2 Final to ArcGIS 9.2 Service Pack 1.
Upgrade ArcMap, ArcCatalog and the Engine Runtime to the same service pack level as ArcGIS Server.