Ioannis,
You have to compile with MPASM, not PM.

mpardinho,
You probably miswired something. with your exact program it works fine here. Also.. there's no PORTC on PIC16F628 but you should already know that.

i used this line for my config fuses
Code:
@   __CONFIG  _INTRC_OSC_NOCLKOUT & _MCLRE_OFF  &  _LVP_OFF & _WDT_OFF & _PWRTE_ON  & _BODEN_ON
Did you tried with OPTION_REG.7=0 without resistor?

wich value of pull-up?