Getting permission denied from server trying to browse subfolders

Winscp 5.17.5. SFTP.
Running agaist proftpd that is running mod_sftp. If I connect to it with ftp it works.
I can connect and list files and folders but when I try to browse to a subfolder I get:

Permission denied.
Error code: 3
Error message from server (en-US): Permission denied

If I download the folder I get all the files and subfolders inside that folder and can browse them locally. I can also upload folders but not browse them.
Toubleshooting:
On the server I have set permissions to 777 on all the files and folders.
Set SFTPClientMatch ".*WinSCP.*" sftpProtocolVersion 4 that a 2010 forum post suggested. Tried older versions within winscp.
Running without chroot.

Not sure if this is a problem with winscp or not, but I can't seem to replicate it on any other client (linux sftp, putty sftp, filezilla).

I do not know why the server fails the "lstat" request. What version on ProFTPD are you using? Can you get a more verbose server log file?

I'm running debian buster in a container and the binary says ProFTPD Version 1.3.6. 1.3.6-4+deb10u5 should the version. I've run proftpd as so I'm not sure if I can get any more debug messages out.

It seems to work with sshd and cerberus, just not proftpd. But also only winscp that get this error message. Maybe the other clients uses some other method?

ProFTPD seems to be doing lot of logging when handling the lstat request, so please try to setup the logging:
https://github.com/proftpd/proftpd/blob/v1.3.6c/contrib/mod_sftp/fxp.c#L8178-L8373

Thank you! I thought everything logged to stdout when running as non daemon. I found the problem with SFTPLog setting.
Removed all limits and now it works. Weird other clients doesn't use it that way. Not sure if that still is a problem with client or not, maybe they have some fallback method? But atleast now I can work around that.

The other clients (OpenSSH sftp, pftp and FileZilla) do not use the lstat request.