Not allowing Module names with spaces

We are using enterprise templates and have based our project on the
Application Architecture templates available on gotdotnet.com. This means
that our solution consists of a hierarchy of folders containing our
projects.
By default, the Application Architecture templates contain directory names
with spaces (eg "Business Layer"). What happens when I checkin my solution
is that I get the proxy dialog box for each directory asking me what module
to check it into. By default, the module name specified is the root module
name. Keeping this module name does allow me to checkin the directories
containing the spaces but in my enterprise template files (.etp files), the
source control section has the ProjectPath as the root module and the
LocalPath is a relative path back to the root module (eg ../../..).

I can however enter an appropriate module name in each dialog that appears.
Eg:

Prompts with Module Name of: AppArch1
Local Directory: c:\svnroot\AppArch1\Data Layer\Business Layer.etp

I can try to enter for Module Name: AppArch1/Business Layer

But I get an error saying: URL 'svn://dev5/ebe/Business Layer' is not
properly URI-encoded
Extract from the debuglog.txt file is given at the end of this message.

If I rename my folders to not have a space (eg BusinessLayer) then I can
create the module fine.
My question is whether I should be bothering to create the modules for each
directory or whether I should just stick to the paths relative to the
solution root?
Since you can create folders in svn containing spaces, should you be able
to do it here?
I noticed that when I renamed the folders within the repository to remove
the spaces, they appeared like: "Business%20Logic". I tried naming my
module this way when creating it but I got the same error.

Debug Extract:

SccOpenProject started, params are valid
Local proj = C:\svnroot\ebe\Business Layer
Aux proj = svn://dev5/ebe|tbates
Projject = svn://dev5/ebe/Business Layer
Path not controlled : C:\svnroot\ebe\Business Layer
Checking connection to SVNURL : svn://dev5/ebe/Business Layer
Trying to launch C:\Program Files\PushOk Software\SVN Proxy\svn.exe
--username "tbates" --non-interactive list "svn://dev5/ebe/Business Layer"
in folder "/"
Launched C:\Program Files\PushOk Software\SVN Proxy\svn.exe --username
"tbates" --non-interactive list "svn://dev5/ebe/Business Layer" in folder
"/"
svn: URL 'svn://dev5/ebe/Business Layer' is not properly URI-encoded


=> ERROR
SVN url invalid : svn://dev5/ebe/Business Layer
CSccOut:Shower: start event
CSccOut:Shower: end event
CVSConnect: Ok pressed
Checking connection to SVNURL : svn://dev5/ebe/Business Layer
Trying to launch C:\Program Files\PushOk Software\SVN Proxy\svn.exe
--username "tbates" --non-interactive list "svn://dev5/ebe/Business Layer"
in folder "/"
Launched C:\Program Files\PushOk Software\SVN Proxy\svn.exe --username
"tbates" --non-interactive list "svn://dev5/ebe/Business Layer" in folder
"/"
svn: URL 'svn://dev5/ebe/Business Layer' is not properly URI-encoded


=> ERROR
Checking connection to SVNURL : svn://dev5/ebe/Business Layer
Trying to launch C:\Program Files\PushOk Software\SVN Proxy\svn.exe
--username "tbates" --non-interactive list "svn://dev5/ebe/Business Layer"
in folder "/"
Launched C:\Program Files\PushOk Software\SVN Proxy\svn.exe --username
"tbates" --non-interactive list "svn://dev5/ebe/Business Layer" in folder
"/"
svn: URL 'svn://dev5/ebe/Business Layer' is not properly URI-encoded