Why is Syslog Not Writing Logs To The Designated Files?
Did you restart syslogd? You can also use lsof -f -p <pid-of-syslogd> to see what log files it has open. The syslog.conf looks right, you might want to post your apache configuration.
For those lost in googling with similar symptoms after an update from Ubuntu LTS 12.04 to 14.04.1: syslog was replaced by rsyslog, which is for some reason not installed by the distribution-upgrade.
solution is to apt-get install rsyslog