Problem: Cannot install extension (plugin) on slave site.

JInstaller::install: Failed to copy file: /home/mysite/public_html/tmp/install_4a2ee51fc3f36/JIncludes.php to /home/mysite/public_html/plugins/content/JIncludes.php

Why is the system trying to install the plugin to the master site again? Shouldnt it try to install the plugin to the slave directory?

Is plugin installed on Master Site? YES
Are all folders chmod 777? YES
Does using ftp layer in Joomla solve issue? NO

You say this is not a permission problem and that FTP layer can not solve the problem.

The installation of an extension use the standard Joomla installation with overwrite parameter enabled.
When you install an extension from package, Joomla start by the upload into the tmp directory and after, and unzip it into the tmp directory.
When unzipped, it can analyze the extension and in particular its manifest files where it retreive the list of files that must be copied into the target directory.
This is during this phase that Joomla received an error to copy a file.
This is the symptom of a permission problem.

We have installed with FULL SUCCESS the JInclude 0.70 beta and we repeat that this is problably a permission problem.
We have installed it in a master AND a slave site with full success.

Thank you Edwin for speedy response.

It turns out that YES, this WAS a permissions issue. Edwin was correct in his analysis and helped me resolve it.

Thank you!