I think,
He made with an ftp prog al the folders and subfolders manual and also atributes for that folders on 777 ( user rights)
Then you have to set with the admin of oscommerce the thumbnail cache directory the right path.
( if the folders where already made by image magic then the rights can't be set because of apache owner for that folders) ( aks your admin or provider to remove them or to set the proper owner with userrights)
So then do make another folder and subfolders before you set:
The folder in the admin of oscommerce and after that switch the the cache to on .
[Also I made mistake in my last post after turning safe mode on agian the user rights are not sufficent for caching.]