What all the confusion boils down to is the UI doesn't make it clear that the checkbox is a command along with a status indicator. Filled in with a "-" means the folder can have read only files in it, but doesn't indicate whether it does or not. It's the default for folders. For what it's worth the checkbox does work as intended. I did just verify that putting a check in the box (click twice) makes all the files in the folder read only, and unchecking the box removes the read only status of all files in the folder as long as those files are not locked. You will get an error after clicking Apply or OK if you don't have permission to edit any file(s) in the folder the system attempts to change. If you remove read only status from all files in the folder the box will revert to filled in with a "-" the next time you pull up properties for that folder. As I said before, it's the default and you can safely ignore it - it doesn't mean the system changed files in the folder back to read only. Most definitely not the way I would have scripted this part of the UI, but I guess it made sense to whoever did.
I believe some of the people posing questions in this thread have file locks or network share issues that result in not being able to save edited files.
LesFerch - Thanks, and keep up the good work. Just remember you can't get through to everyone.
Your friendly neighborhood hacker, oops, system security specialist. lol.