Actually, I did try to sleep for about 2 seconds I think... still didn't work. I considered your same reasoning
Ultimately, I think it is a kernel or OS initialization thing. I installed Script Manager and set the entire script to run on boot, removing the init.d script. For this app, on-boot scripts don't run until external storage is mounted, which obviously doesn't happen until later in the boot process. By this point, the script works just fine as intended.
So bug or timing problem? I can't say for sure.