OK, I think I've solved this problem on my own.
Calibre was running in /var/www and was trying to create a directory /var/www/.config. However I was the owner of /var/www, not apache. If I ran it from commandline I assume it used the .config in my home directory, but when apache ran it (as www-data on ubuntu) is was trying (and failing) to create /var/www/.config.
When I changed the owner of /var/www/ to www-data it worked fine.
Thanks everyone for all their help.
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