hi
    i too have the same problem. my ps output is this

[root@centrallib log]# ps -ef | grep z39
root      5275     1  0 09:56 pts/1    00:00:00 su -c /usr/local/koha/intranet/scripts/z3950daemon/z3950-daemon-shell.sh -
apache    5276  5275  0 09:56 pts/1    00:00:00 /usr/bin/perl /usr/local/koha/intranet/scripts/z3950daemon/processz3950queue /usr/local/koha/log
root      5403  5128  0 10:04 pts/1    00:00:00 grep z39
[root@centrallib log]#

it does create the log file on the format specified but there is only an empty file generated permissions for the log directory is 777.

--
Regards
Mohamed Imran K R