What are the settings to correct vsftpd "500 OOPS: cannot change directory" error?

Run this one command, no need to restart any service & server:

# setenforce 0

To check SELinux status :

# getenforce

or

edit the file /etc/sysconfig/selinux to include

SELINUX=disabled

Doing so will require a reboot.

Although disabling SELinux by SELINUX=disabled will solve the problem this would not be advisable. You can enable ftp user to access his home directory by configuring SELinux boolean value ftp_home_dir by running the following command:

setsebool -P ftp_home_dir=1

you can always allow the FTP daemon full access to all files by running

setsebool -P allow_ftpd_full_access 1