Well, if you want to be able to use SFTP or SCP and copy files to ANY directory, you pretty much have to use 'root'.
Otherwise you have to SFTP/SCP the files to the users home directory, then ssh in, then sudo up to root, then copy the files, then change the file permissions.
Personally, I set
Code:
PermitRootLogin without-password
ChallengeResponseAuthentication no
Gen the certs
And set my Filezilla SFTP client or WinSCP client to login as 'root' with the correct cert.
Just remember to change the ownership/rights as needed.
Of course I'm old school (scientific unix), and don't have the vast fear of using a root account that you young ubuntu fellows seem to have.
YMMV