git under Windows 7
There are already some posts out there discussing this issue which git in cygwin has under Windows Vista. It will be no surprise if I tell you that the same problem still exists under Windows 7.
Microsofts UAC looks for executables with “install”, “update” or “setup” in their name and requires user account elevation to execute them. This does not work for git-update-index.exe under cygwin and so the command fails with “Permission denied”.
The workaround of creating manifest files for each of the “suspicious” files as described here worked for me.
Have you tried it with the Cygwin 1.7 beta? I don’t whether that makes a difference to git, but it does work around quite a few issues specific ti se7en.