So which files do I have to set the write permissions for? Am i missing something here? Or do I have to go through every file in magento and set the permissions for each one? That seems a bit far fetched....
How are you changing the permissions, manually (one by one) like in FTP, or are you doing this via SSH (recursively). To be honest, this is something that you need to do recursively, either with SSH or an FTP program that can do this. Everything has to be set to 777, not just directories:
As I posted here: http://www.magentocommerce.com/boards/viewthread/5395/#
i would not recommend to change the permission to just about everything recursively as the command that you use might do so.
Here is a command that you can run on your SSH window to CHMOD only the directly and the subdirectories but not the files under those directories:
find [YOURDIR] -type d -exec chmod 777 {} \;
All you have to do is to go to your magento installation directory on your server through SSH and from that directory type this command:
find . -type d -exec chmod 777 {} \;
This will change the permissions of only directory and subdirectories under magento; which changing the permissions on the magento directory itself as you do not need to have it changed.
Obviously it would be better to know exactly which directory(ies) need this fix and only apply this change to them.