I have tried PHP's ftp_site($ftpStream, 'chgrp nobody '.$directory) but I cannot get it to work. Does anyone out there have any success changing a directories group via ftp_connect() in PHP? Thanks.
This is not actually a php issue, but an ftp server issue. You stated in a comment, the php error log contained:
This simply means that the ftp server does not support the CHGRP command. If you try a desktop ftp application, or ftp from the command line, you should receive the same error back from the ftp server when trying to change the group.
Since you have access to the server, why not just chgrp the directory from the command line?
Let me ask this...
If I use a Deny from all directive on this directory, yet set its permissions to 0757 (drwxr-xrwx) is that too dangerous?