Once you select your full path deployment folder and full path resource folder mBuild should generate the full path to the ZIP file automatically.
Double check the Project ID field in mBuild. Make sure it's blank if creating a new project. That will create a new project on the PhoneGap side. If your updating an existing pproject, make sure the mBuild project ID matches the project ID on the PhoneGap server.
In the mBuild project settings, go to the Config.Xml settings. Try using the default config.xml file. It will appear to be missing many settings. That's expected. mBuild will automatically update the config.xml file based upon your settings. I do believe, if I remember correctly, that PhoneGap's server will return an error if the config.xml file is missing or improperly formatted.
Also, I don't know how you're approaching your keys. The keys have to be "unlocked" on the PhoneGap side before PhoneGap will accept an uploaded ZIP file. If you create and upload your jeys through mBuild, mBuild will automatically unlock your keys on the PhoneGap server. If you have pre-existing keys on PhoneGap, you can enter the key's credentials in mBuild and it will still unlock them for you.
Bruce will be conducting an in depth look at mBuild at this Friday's webinar. I would try to attend if possible. mBuild does work really good once you get the settings right.
Good luck,
Don