Error code (ERR_ACCESS_DENIED) Local HTML file on SD card with Chrome
In case some one else comes across this. I did not completely figure out why 1 updated firmware tablet works and 1 non updated tablet does not with the same file path from sdcard0. I did notice on the updated firmware tablet in storage I have folders emulated(read only), sdcard0(read/write), and sdcard1(neither). What I understand these are android 4.2 multiuser folders.

Using the html file from either legacy/0 folders within the emulated folder turns out to work fine with Chrome. Both those folders are read and write. So that is my solution for now. 

Side note, the emulated folder is not on the non updated firmware tablet.