I think I figured out what the problem is.

When I changed the PHP back to 5.2 all the permissions took, which means that they will not work under PHP 5.4 which also means it is a 7.5.8 bug that was obviously missed.

In other words, the permissions all work under PHP 5.2 but not under 5.4 with the problem being that the host will soon be removing PHP 5.2 as an option.