Extract Component to File not working when selecting current directory?

[KamilDev]

When I try to use Extract Component to File option and select current directory, it will result in an error:

If I were to manually modify the path to be relative to the workspace directory, for example:

c:\Users\Kamil\Dev\Temp\nextjs-test\app\components\test.tsx

becomes

\app\components\test.tsx

Then it would work.

Perhaps this should be the intended behavior for workspace projects?