You shouldn't need to mess with the file permissions.
If I remembered correctly I think it is due to missing phrases. Make sure the phrase names in your cpnav_XXX.xml file correspond correctly to the Phrases you have created. Also make the sure the phrases are added to the AdminCP (Navigation?) Phrase group. (I can't remember the exact name off the top of my head).
Also check that your XML document does not have any errors such as unclosed tags or anything like that.
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