Was able to get it to work, seems Mac users may be out of luck. I tried changing the file extension on my Mac and it didn't take. Repeated the whole process on my Windows box and presto it worked like a charm.
I find it odd since I recall Mac OS asking if I wanted to change extensions in the past, but this time it just kept ones which did not seem to trigger my H2O to scan them.
I've opted out of it for now since I underestimated what I would be able to do. This isn't any fault of the OP. And this is still a very nifty feature. I just wish things were a bit more polished.
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