I have given up using the SP package manager to chmod files.
My host is 1 and 1. When chmod sets permissions too permissively, the host throws a 500 error. For some reason, when I try to use SMF to chmod files, it doesn't stop with my forum. It goes up directory, chmods the ftp login directory to 777, and I cannot even ftp to my website after that. I need external help to re-chmod my root directory. After that, it is an easy matter to re-CHMOD the rest of the files.
1and1 sets up the webserver with suphp. This means that, when you use the webserver/php to create files (as you do when you use the package manager), those files are created by you, not by whatever-user-they-have-set-up-to-run-the-webserver.
Since it is not necessary to allow any other user to write to your files, 1and1 also prohibits giving write permission to other users. It gives a 500 error if you try to give out "too much" permission.
See
http://simpleportal.net/index.php?topic=6312.msg36685 for more.
Each digit in the chmod is the sum of : (execute (1 if yes, 0 if no)) + (write (2 if yes, 0 if no)) + (read (4 if yes, 0 if no))
The digits are: ugw (user, group, world)
For u, you can use any of the possible values. So 7 is fine for directories, 6 for ordinary files.
For w, write=0, which means you can use 0, 1, 4, or 5, but not 2, 3, 6, or 7.
For g, I've read either that you can use the same values as for u, or that you should stick to the same values that are OK for w.
This means that, for directories, you should be able to use 755 (775 might work, but you don't need it)
For files, 644 should work (or 664, but why bother?).
If you have fixed your chmod, and still get 500 errors, try temporarily removing your .htaccess file. A bad .htaccess file can also cause a 500 error.