>If "output.file" does not exist, then the "del" command will give a message 
>which causes the ftp step to get a non-zero return code

I CANNOT believe you haven't figured a work around for this.
Here's a simple one:

STEP 1: delete the file with IDCAMS or IEFBR14
STEP 2: FTP with (EXIT
STEP 3: rename

When in doubt.
PANIC!!      

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