Error creating public folder (v2)

I created a folder in our private wiki, and tried to set that folder to "publicly-viewable." When I submitted the form, I got a raw-looking error "Access Denied."
Steps I took (again, a private wiki):
1. Created a folder "KB"
2. Created a page in the folder.
3. Clicked on the folder from the right column list of folders.
4. Clicked security.
5. Left the radio to first option, but checked the box "Make this folder public."
6. Clicked Save.
Response:
Access Denied (no markup at all, just the response with a 200 HTTP status header)