xfe has been in the repo for five months and lots of people are using it. I have no problem creating new folders. So... I'd suggest reposting this in the X area (or someplace similar) so that folks can help you troubleshoot the problem which appears to be specific to your system/configuration.
eMachines EL-1300G desktop, 1.6GHz AMD Athlon 2650e CPU, 4GB RAM, nVidia GeForce 6150 SE video
CentOS 6.5 (will try VL64-7.1 soon)
Toshiba Satellite A135-S4727, Intel Pentium T2080 / 1.73 GHz, 2GB RAM, Intel GMA 950
HP Mini 110 netbook, 1.6GHz Intel Atom CPU, 2GB RAM, Intel 950 video, VL 7.1