Thanks for reporting this. I think it is a logic bug, that happens when you run the configure tool with elevated permissions. It assigns the current user (an administrator account) as the owner, and then the check fails because that owner is not in the permitted set (Administrator (group) or SYSTEM) once the service starts.
The screenshot does say “Owner: Administrator”, but that is not the SID that Duplicati finds as the folder owner. The SID that Duplicati reports looks like a local administrator SID.
I will update the configure tool to handle this with a --for-service option. For a fix, there are two ways to do it.
The simple fix is to run
Duplicati.WindowsService.exe secure-datafolder
This will restart the service and ask it to set the permissions. Since this runs in the service context, it will set the correct permissions.
Alternative is to edit the setup, remove the “Administrator” entry from the permission entries so it only has “SYSTEM” and “Administrators” (note the trailing s). Then change the Owner to be “SYSTEM” (or Administrators).
The problem is that inside the backup, there is 1 file where the metadata does not match up. You should be able to use the new “Purge broken files” UI to list and remove/fix the entry that cannot be mapped.