Can't export as website...

[steve.ledger]

I've tracked down my problem and its related to what Xara declares to be an illegal pathname, even though the pathname/filename is perfectly legal for Windows.

Out of interest, and in the hope of shedding more light - can you please show us the full path of the folder in question?

Is Xara just being "big brother" and trying to forcibly protect me from using a path that wouldn't be legal as a URL?

I seriously doubt that to be the case. The name of the containing folder on your local drive is not necessarily going to be the name of the folder on the remote server. In most cases, the site being created is likely to be the default site for your domain, so the files will not be in any folder at all, they'd simply be in the root of 'public_html'.
Xara would not be second guessing here.

Untill I see your full path I can't think of any reason why a folder name which is allowed by the OS is being rejected when you try to export.

Note that when you export, if you call the htm file phun, then the subfolder for the site resources (images, .js and .css) is automatically named phun.htm_files. This is more likely where the error is cropping up.
Unless there is some weird keyboard mapping error happening on your machine which is resulting in an illegal character, there's no reason why naming your export to red would result in the creation of an illegally named resource folder (red.htm_files)