This issue is mainly documentation for any other developers searching for how TinyMCE relates to the .htaccess file with "deny all" in it. I had been getting the access denied errors when trying to open a directory in IMCE that was set to private "deny all" htaccess method. I had assumed that the problem was the htaccess settings. However, it turned out to simply be a file permissions issue which was fixed by simply chmoding the directories to 777 and leaving the htaccess file intact.