This is probably one of the most problematic issues with running WP as your CMS. I run several blogs/sites on WP and quite frequently I have had to manipulate files/permissions and settings to get the auto update features to work correctly. Plug-ins, Core files all need a few simple things in place to have this update work correctly.
Having just fixed this blog, it’s time to explain a few steps that I have taken.
This can be a tricky area and a lot depends on how your host runs PHP. Each host has their own way of doing things and for the most part WordPress should run fine. I run on Media Temple so what I talk about typically will work on any CentOS/Plesk configuration.
WordPress files and folders should be set to 0755. There are other folders/files that need permissions at 0777 if you are going to allow WordPress to write any files that you might upload. Set wp-content/uploads and wp-content/cache to 0777. This is important if you want caching to work or if you are going to be using the media upload capabilities of WordPress.