I always forget about sdeintercept. When I connect as the sde user, all the feature classes are owned by sde, I can edit anything. I removed db_datareader and db_datawriter from my domain user in the database and tried to connect with an sdeintercept set up. When I add a feature class from a dataset I can edit the contents of the dataset is recorded in the output as "User Privileges: SELECT, UPDATE, INSERT, DELETE" but when I add something from a dataset I am blocked from editing only "User Privileges: SELECT" is recorded for the data. I checked and do have full privileges for both datasets. I will open a support ticket in the morning on this.