iTerm2 doesn't read com.googlecode.iterm2.plist
Preferences are cached in 10.9. See http://hints.macworld.com/article.php?story=20130908042828630. If you edit a plist file directly or replace the plist of an application, the application will keep using the cached version even after you quit and reopen the application.

You can run defaults read com.googlecode.iterm2 or killall cfprefsd to apply the changes:


Quit iTerm
Edit the plist
Run defaults read com.googlecode.iterm2 or killall cfprefsd
Open iTerm


Changes made with defaults are applied after you just quit and reopen an application like in earlier versions of OS X.