I was unsuccessfully trying to figure out why Obsidian would not let me save new attachments to a subfolder under the current folder. Then I figured out that the ‘attachments’ in the ‘Subfolder name’ field was written in light grey, meaning that it’s an example and not the default value. Explicitly typing ‘attachments’ in that field solved the issue.
I suggest changing the text to ‘E.g. ‘attachments’’, it will be clearer for users what’s going on.