A note to add to this: Movable Type by default likes to create folders that are 0777. So when I rolled over to a new month...suddenly I had a problem again. Blurg.
Solution was found here:
http://forums.movabletype.org/2010/02/need-archive-folders-created-with-perm-of-755-not-777.html
with mt-config directive which should be set for 0022
>#==== NEW DEFAULT DIRECTORY PERMISSION ==
DirUmak 0644
Carry on!