This is, as the bug notes, a regression, and I'm guessing you're right about it being in the initscript (I'm pretty sure). I used to be a very heavy Squid user and Squid developer and I remember a very similar bug many years ago. It was in the cache_dir initialization code. It would read the configuration file, parse out the cache_dir lines, and if the directories didn't exist it would create them as part of the startup.

There were some circumstances where if there was no cache_dir line configured, or if the cache_dir was a link or something, the details are very sketchy in my mind after so much time, but it would end up destroying /.

I'm guessing this is of that same nature.