[2.2.10 prerelease] Trying to load a folder as an addon causes a "bad cycle" error every time

This specific error occurs no matter what you do. I've even tried removing the ANIMDEFS file from the folder I'm loading but that causes it to throws an error about an animated texture cycle from what I can only assume is the vanilla game files.

ANIMDEFS included in the folder ^^

ANIMDEFS not included in the folder ^^

I was quite excited for this feature so that I could stop recompiling my PK3 for every change I make and just load the folder itself. This issue results in me being unable to use the addfolder/-folder feature at all. The mod I'm using here is MRCE. I can compile and load the PK3 just fine but trying to use addfolder/-folder causes this issue.