Here's an issue the the App-V beta team ran into and since I didn't see it documented anywhere else I thought I'd give everyone a heads up here:
Issue: When sequencing an application with the App-V Command Line Interface (CLI) Sequencer (SFTSequencer.com) you may receive an “Invalid mount point specified” error message if the install path defined by either the “/InstallPath:” or “/P (short Version)" parameter is more than 255 characters. The /INSTALLPATH or /P parameters are used to specify the package root directory.
Cause: This error can be misleading as the real cause is not because the install path has invalid characters, but because the install path is greater than 255 characters.
Resolution: To resolve this error please insure that the path defined by either the SFTSequencer.com “/InstallPath:” or “/P (short Version)" parameter which defines the path where the installer (or batch file) will install the program is less than 255 characters in length.
For more information about the App-V CLI Sequencer please open the C:\Program Files\Microsoft Application Virtualization Sequencer\sftsequencer.chm (default location) file and search for 'Command Line.'
J.C. Hornbeck | Manageability Knowledge Engineer