Ran into the same problem here.
I have some additional info: the permission problem only occurs when 
transmission-daemon gets started with the init.d script ie. on boot or 
(re)starting with /etc/init.d/transmission-daemon (re)start. When I start it 
from the cli with transmission-daemon -f everything works as it should.

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permission denied
https://bugs.launchpad.net/bugs/530193
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