magento-1.9 – Display Simple Product Stock on Configurable Product

I just tried your exact code (with save enabled) on my Magento installation and it just works without modification.

There has to be another issue at your machine when it gives a 404 - maybe the product is disabled automatically (i.e. getting status attribute 0) as it was out of stock?

In addition, I refactored your code to avoid usages of array access ['controller_action'], addData and getData. It is best practice to use the magic methods instead.

Moreover, using the event catalog_controller_product_init passes a loaded product instance in its parameters so you don't have to do the loading yourself.

<events>
    <catalog_controller_product_init>
        <observers>
            <stackday>
                <class>stackday/observer</class>
                <method>updateInventoryOnProduct</method>
                <type>singleton</type>
            </stackday>
        </observers>
    </catalog_controller_product_init>
</events>

Observer:

/**
 * Update inventory on product.
 * 
 * @param Varien_Event_Observer $observer Observer.
 *
 * @throws Exception
 * 
 * @return void
 */
public function updateInventoryOnProduct(Varien_Event_Observer $observer)
{
    /** @var Mage_Catalog_Model_Product $product */
    $product = $observer->getProduct();

    if ($product->getTypeId() != Mage_Catalog_Model_Product_Type::TYPE_CONFIGURABLE) {
        return;
    }

    $childProducts = Mage::getModel('catalog/product_type_configurable')
        ->getUsedProducts(null, $product);

    foreach ($childProducts as $child) {
        /** @var Mage_Catalog_Model_Product $child */

        /** @var Mage_CatalogInventory_Model_Stock_Item $stock */
        $stock = $child->getStockItem();

        if ($stock->getQty() == 0) {
            $stock->setQty(27);
            $stock->setIsInStock(1);
            $stock->save();
        }
    }
}

But even with this code, the product may be displayed as Out of Stock - as there is an indexer in play here. You would have to run cataloginventory_stock indexer programmatically after updating stock item.

Make sure that you associated the simple products with the configurable product. Therefore, go to the configurable product, open the "Associated Products" tab, select the appropriate simple products and save. If you do not see your simple products there, make sure to click on "Reset Filter" (and that your simple products have the same attribute set as your configurable one). As always, you may need to reindex or clear your cache.