I don't see that file at the specified location, and I also can't find that file anywhere in that forest green template theme .zip
I searched the zip file for any .xml files, but didn't locate any. There is a Web.config file, but that doesn't seem to be the file the error message is looking for.
Is there some mistake I am making, I assume that the template package would be functional since it has the SiteFinity Validated logo next to it?
I will double check on the permissions issue and post back later, but I know when I created the folder I granted rights to it, though perhaps it didn't carry to the newly unzipped folder.