Yes I can confirm this is a problem, and without a fix leaves this feature as a misleading moot point really.
I also had the problem above, when I first went to set the URL - it wouldn't accept anything. But leaving and coming back to the page - it then seemed to work.
From this experience - the page needs some user experience improvements.
The error 'invalid url' gives no instruction on why it might be invalid.
Also - if you turn on the 404 redirection option - the page then has two URL fields - yet the 'invalid url' error does not distinguish which URL is invalid.
The redirection URL field doesn't accept a full URL - only the slug.
You can't therefore set it to be the homepage, because you would need to save an empty field (which it says is invalid). And if you enter just / it sets the URL to be http://yourdomain.com//
Finally - the page instructions are not clear enough. In one place it says to enter a slug - but in others not - it could be clearer. Plus it refers to Masking URLs and uses plural in other places too - when there is only one URL to be set for masking.
This is very useful - perhaps it should be included or linked to the official documentation, because even simpler exceptions might be required.
I just ran an initial file scan for the first time on a site - and it flagged a /downloads folder as (rightly) not being part of WP. We use it to provide certain purchased digital products that we currently can't store within WP itself.
However, before I said to 'Ignore' that - it locked down the folder and anyone trying to download from it got a 403 forbidden. And, even then choosing to 'Ignore' the folder (which I would imply as being to permit it) it still kept it locked down.
I understand this behaviour (it's a security plugin after all) but nowhere did it make clear (or did I miss it?) that it was going to act on locking down anything found outside WP?
Thankfully I spotted it quickly - and then found the above snippet to resolve.
Perhaps alongside 'Ignore' (which seems to simply take it off the list) there should be a 'Permit' or 'Except' option?
I don't know whether this was introduced after your post here - but this feature exists.
If you go to My Account (under your avatar when logged in) and scroll down to the Add-Ons section. You should see Manage Backups Storage. You can add more storage, but if you click on 'All Backups' link, you can see what's being held there. Expand a backup and there is a Delete option.
HOWEVER - I just tried to delete one or two and got an error message saying it failed.
This might be because the original site has been disconnected from the hub (infact deleted altogether) - although that is still a real problem if I can't delete them from here if the original site isn't available.