If you guys think this is a small issue by a small subset of users think again. You are marked as broken on your plugin page. over 61 people. You have many posts every day about this issue. Maybe your paid enterprise clients can get around it with your help but if you don't share what you are doing to fix it. You are going to lose your install base to other caching plugins and that install base will take their enterprise clients with them.
I too believe that my problems are from server configuration. I don't think my server is configured *wrong* but something about the way my server is configured and the way the w3tc uses the FS API is not getting along. WP has no problem installing plugins using the same API
I believe that the problems lies in a thrown exception during the SETUP class on the w3tc cache admin page. w3tc goes through a self test to make sure the files it uses in cache directory are the right permissions. To do this is creates a test_dir and a test_file.
The test_dir is created just fine on my server therefore the test_file should work in a dir created by the plugin.
I would test further but I have to go live with the site very soon and need a solution that works!
I believe the problem may lie in how cpanel configures the apahce server by default. there is the user Apache:Apache and then the user Webuser:psagroup (not exactly that) Then php is configured to SuExec as Webuser.. but when files are created they are created by apache:apache.
Btw the plugins operates normally when I manually install everything and the set the right permissions but i am still presented with errors.. I think the errors are from the testing portion. (the test fails but the plugin otherwise CAN use the files.