SharePoint Newbie Permissions Question

[Joe Fowler]

I have little experience with SharePoint and just recently set up a SharePoint library folder. I need to set the user permissions for the folder such that users can download Excel workbooks from the folder, edit / modify the spreadsheets as they see fit, and store them to their personal computers, but not back into the SharePoint folder. Nor should they be able to store any type of file into the SharePoint folder. Is that possible, and if so, how. I originally set the user folder permission to "Read - Can view only." thinking it would function as outlined above. Users can download the spreadsheets from the folder, but not switch to edit mode. Is that the intended SharePoint functionality, or is there a setting somewhere not set correctly? Any help or suggestions appreciated. Thanks.