Things I have tried:
1) Enabled hidden administrator logon and logged onto it.
2) Edited user permission for entire drive and set to 'full control'
3) verified the folder is not locked/in-use even deleted it and then restored
Still has the stupid 'read only' box checked when you hit Properties. I am updating Starcraft 2 and get a file creation error during patching. The read only setting is the only thing I can think to change other than full uninstall -> reinstall.
edit: Just tried doing it in elevated command prompt and the R flag for readonly is not present at all even looking all sub-folders with the /S switch. So apparently its not read only but explorer is noting it so in 'properties' ... very strange.