Hi ndrancs
The permissions were set correctly, but the owners should be root root, not root staff, though I don't
think that should cause a problem. Since bootlocal runs as root and restore is executed after hosts
is created, backing up a modified hosts file should work. Try this:
Remove /bin/chmod 0775 /etc/hosts and /bin/cat /home/tc/hosts >> /etc/hosts from bootlocal
Enter sudo /bin/cat /home/tc/hosts >> /etc/hosts at the command line
Do a backup, reboot, and see if the hosts file remembers its changes