[Dovecot] "Internal Error" from maildirs (new user)

[Sean 'Shaleh' Perry]

I decided to give dovecot a try this morning.  To create a test system I 
copied mail from my wife and myself into /var/spool/imap.  This mail was 
already in maildir format from our mail clients.  I set the mail env to 
maildir:/var/spool/imap/%u.

Below is a session (via telnet):

<begin>
. OK Logged in.
. list "" *
* LIST (\UnMarked) "." "blackbox"
* LIST (\UnMarked) "." "blackbox-devel"
* LIST (\UnMarked) "." "debian-devel"
* LIST (\UnMarked) "." "debian-dpkg"
* LIST (\UnMarked) "." "debian-ipv6"
* LIST (\UnMarked) "." "debian-laptop"
* LIST (\UnMarked) "." "debian-legal"
* LIST (\UnMarked) "." "debian-lint"
* LIST (\UnMarked) "." "debian-mentors"
* LIST (\UnMarked) "." "debian-policy"
* LIST (\UnMarked) "." "debian-private"
* LIST (\UnMarked) "." "debian-publicity"
* LIST (\UnMarked) "." "debian-python"
* LIST (\UnMarked) "." "debian-qa"
* LIST (\UnMarked) "." "debian-release"
* LIST (\UnMarked) "." "debian-security"
* LIST (\UnMarked) "." "debian-spi"
* LIST (\UnMarked) "." "debian-testing"
* LIST (\UnMarked) "." "debian-user"
* LIST (\UnMarked) "." "debian-vote"
* LIST (\UnMarked) "." "drafts"
* LIST (\UnMarked) "." "lsb-impl"
* LIST (\UnMarked) "." "bad"
* LIST (\UnMarked) "." "lsb-test"
* LIST (\UnMarked) "." "maradns"
* LIST (\UnMarked) "." "narval"
* LIST (\UnMarked) "." "python-list"
* LIST (\UnMarked) "." "sent-mail"
* LIST (\UnMarked) "." "spam"
* LIST (\UnMarked) "." "storage"
* LIST (\UnMarked) "." "trash"
* LIST (\UnMarked) "." "xdg"
* LIST (\UnMarked) "." "outbox"
* LIST (\UnMarked) "." "bf-python"
* LIST (\UnMarked) "." "debian-bug"
* LIST (\UnMarked) "." "python-tutor"
* LIST (\Marked) "." "INBOX"
. OK List completed.
. select inbox
. NO Internal error [2003-07-04 10:50:51]
. examine inbox
. NO Internal error [2003-07-04 10:52:22]
. examine bad
* NO Couldn't use index files
* FLAGS (\Answered \Flagged \Deleted \Seen \Draft)
* OK [PERMANENTFLAGS ()] Read-only mailbox.
* 0 EXISTS
* 0 RECENT
* OK [UIDVALIDITY 1057341147] UIDs valid
* OK [UIDNEXT 1] Predicted next UID
. OK [READ-ONLY] Select completed.
<end>

I can find no cause of the inbox error in any log.  Suggestions?

All of my sub folders come back as read only (even when I use select).  I 
presume this is a permissions issue.  What should the perms be?

I am using 0.99.10 from Debian if it matters.